CLIMATE SPECTATOR: The clean energy data that matters
Global clean energy investment fell sharply in 2012, as expected. But the result was the second largest on record and contains encouraging signs for the sector.
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Climate Spectator
Global clean energy investment fell 11 per cent in 2012, yet the numbers still came in as the second highest on record.
The decline, the second since research company Bloomberg New Energy Finance began compiling the data in 2004, was primarily the result of two factors:
1) Softer wind and solar pricing, meaning more bang for the investment buck.
2) Policy changes in key markets like the US, Spain, Italy, Germany and India.
All up, investment in 2012 was $US268.7 billion, down from an upwardly revised figure of $302.3 billion in 2011, with the fall driven by less expenditure on large-scale projects. The 2012 total was five times that of 2004 when figures were first collated.
"We warned at the start of last year that investment in 2012 was likely to fall below 2011 levels, but rumours of the death of clean energy investment have been greatly exaggerated,” Michael Liebreich, chief executive of Bloomberg New Energy Finance, said.
"Indeed, the most striking aspect of these figures is that the decline was not bigger – given the fierce headwinds the clean energy sector faced in 2012 as a result of policy uncertainty, the ongoing European fiscal crisis, and continuing sharp falls in technology costs.
"Solar PV module prices, for instance, fell another 24 per cent over the course of last year.”
While some of the mainstays of the sector saw clean energy investment heavily scaled back, this was largely counteracted by development in burgeoning renewables markets like South Africa and Japan, as well as new market leader China, where a record $67.7 billion outlay was achieved. Its total was more than 50 per cent higher than the second-placed US, which saw $44.2 billion in investment, 32 per cent down from last year.
In 2011, the US edged China for top spot as investors rushed to take advantage of stimulus-related programs before they expired.
The most significant falls were recorded in Italy (down 51 per cent), Spain (68 per cent), India (44 per cent) and Germany (27 per cent).
Australia, meanwhile, enjoyed a 40 per cent lift to $6.2 billion.
"Another message from the 2012 data is that investment is broadening rapidly, from established markets such as Europe, the US and China, to new ones in Africa, the Middle East, Latin America and Asia-Oceania,” Liebreich said.
"Australia, South Africa, Morocco, the Ukraine, Mexico, Kenya, Brazil, Ethiopia, Chile and South Korea were among the countries seeing at least one project of more than $250 million financed during the year.”
One note of concern was the lack of investment from private capital and also in publically listed companies. The former fell 34 per cent to $5.8 billion, its lowest figure since 2006, and the latter fell 57 per cent to $5.1 billion, its lowest since 2004.
Merger and acquisition activity also weakened, plunging 31 per cent to $50.8 billion.
Other key findings are set out below.
Sector-by-sector
– Solar, $142.5 billion in investment, down 9 per cent on 2011.
– Wind, $78.3 billion, off 13 per cent.
– Energy-smart technologies (such as smart grid, energy efficiency and electric vehicles), $18.8 billion, weaker by 7 per cent.
– Biomass and waste-to-energy, $9.7 billion, down 27 per cent.
– Small hydro, $7.6 billion, up 17 per cent.
– Biofuels, $4.5 billion, off 38 per cent.
– Geothermal, $1.8 billion, down 39 per cent.
– Carbon capture and storage (CCS), $2.8 billion, 7 per cent less than 2011.
Biggest projects of 2012
– Wikinger (offshore wind), 400 MW and $2.1 billion
– Baltic II (offshore wind), 288 MW and $1.6 billion
– Lincs (offshore wind), 270 MW and $1.6 billion
– Northwind (offshore wind), 216 MW and $1.1 billion
– Dnieper river portfolio (hydro), 980 MW and $2.1 billion
– Masen Ouarzazate (solar thermal), 160MW and $1.2 billion
– Marena (onshore wind) portfolio, 396MW and $1 billion
– Mount Signal plant (solar PV), 235MW and an estimated $941 million
Year-by-year
2004: $53.9 billion
2005: $79.8 billion
2006: $113.7 billion
2007: $164.5 billion
2008: $190.8 billion
2009: $186.9 billion
2010: $251.1 billion
2011: $302.3 billion
2012: $268.7 billion
Global clean energy investment fell 11 per cent in 2012, yet the numbers still came in as the second highest on record.
The decline, the second since research company Bloomberg New Energy Finance began compiling the data in 2004, was primarily the result of two factors:
1) Softer wind and solar pricing, meaning more bang for the investment buck.
2) Policy changes in key markets like the US, Spain, Italy, Germany and India.
All up, investment in 2012 was $US268.7 billion, down from an upwardly revised figure of $302.3 billion in 2011, with the fall driven by less expenditure on large-scale projects. The 2012 total was five times that of 2004 when figures were first collated.
"We warned at the start of last year that investment in 2012 was likely to fall below 2011 levels, but rumours of the death of clean energy investment have been greatly exaggerated,” Michael Liebreich, chief executive of Bloomberg New Energy Finance, said.
"Indeed, the most striking aspect of these figures is that the decline was not bigger – given the fierce headwinds the clean energy sector faced in 2012 as a result of policy uncertainty, the ongoing European fiscal crisis, and continuing sharp falls in technology costs.
"Solar PV module prices, for instance, fell another 24 per cent over the course of last year.”
While some of the mainstays of the sector saw clean energy investment heavily scaled back, this was largely counteracted by development in burgeoning renewables markets like South Africa and Japan, as well as new market leader China, where a record $67.7 billion outlay was achieved. Its total was more than 50 per cent higher than the second-placed US, which saw $44.2 billion in investment, 32 per cent down from last year.
In 2011, the US edged China for top spot as investors rushed to take advantage of stimulus-related programs before they expired.
The most significant falls were recorded in Italy (down 51 per cent), Spain (68 per cent), India (44 per cent) and Germany (27 per cent).
Australia, meanwhile, enjoyed a 40 per cent lift to $6.2 billion.
"Another message from the 2012 data is that investment is broadening rapidly, from established markets such as Europe, the US and China, to new ones in Africa, the Middle East, Latin America and Asia-Oceania,” Liebreich said.
"Australia, South Africa, Morocco, the Ukraine, Mexico, Kenya, Brazil, Ethiopia, Chile and South Korea were among the countries seeing at least one project of more than $250 million financed during the year.”
One note of concern was the lack of investment from private capital and also in publically listed companies. The former fell 34 per cent to $5.8 billion, its lowest figure since 2006, and the latter fell 57 per cent to $5.1 billion, its lowest since 2004.
Merger and acquisition activity also weakened, plunging 31 per cent to $50.8 billion.
Other key findings are set out below.
Sector-by-sector
– Solar, $142.5 billion in investment, down 9 per cent on 2011.
– Wind, $78.3 billion, off 13 per cent.
– Energy-smart technologies (such as smart grid, energy efficiency and electric vehicles), $18.8 billion, weaker by 7 per cent.
– Biomass and waste-to-energy, $9.7 billion, down 27 per cent.
– Small hydro, $7.6 billion, up 17 per cent.
– Biofuels, $4.5 billion, off 38 per cent.
– Geothermal, $1.8 billion, down 39 per cent.
– Carbon capture and storage (CCS), $2.8 billion, 7 per cent less than 2011.
Biggest projects of 2012
– Wikinger (offshore wind), 400 MW and $2.1 billion
– Baltic II (offshore wind), 288 MW and $1.6 billion
– Lincs (offshore wind), 270 MW and $1.6 billion
– Northwind (offshore wind), 216 MW and $1.1 billion
– Dnieper river portfolio (hydro), 980 MW and $2.1 billion
– Masen Ouarzazate (solar thermal), 160MW and $1.2 billion
– Marena (onshore wind) portfolio, 396MW and $1 billion
– Mount Signal plant (solar PV), 235MW and an estimated $941 million
Year-by-year
2004: $53.9 billion
2005: $79.8 billion
2006: $113.7 billion
2007: $164.5 billion
2008: $190.8 billion
2009: $186.9 billion
2010: $251.1 billion
2011: $302.3 billion
2012: $268.7 billion
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