Sydney Morning Herald/ Bloomberg, RenewEconomy (June 13, 2013) — Renewable energy investments are shifting to developing nations as countries from Morocco to Chile pursue power sources that wean them off fossil fuel imports, two studies promoted by the United Nations said.
China’s $US67 billion ($71 billion) of investment in wind, solar and other renewable projects led developing nations to $US112 billion of spending in 2012, according to an e-mailed statement today from the UN and other groups involved in the studies. That compares with $US132 billion of expenditure in the industrialised world.
The gap on renewables spending between richer and developing countries shrank to 18 per cent last year from 250 per cent in 2007, marking a “dramatic change” in investment patterns, the statement said. Two-thirds of the 138 nations that now have clean-energy targets are in the developing world.
Some of the interesting highlights of the reports include:
- Morocco going ahead with a $US1.2 billion investment to finance the Masen Ouarzazate solar thermal project.
- The completion of a 605MW solar PV plant in the Indian state of Gujarat, that will save around 8 million tonnes of CO2 and 900,000 tonnes of natural gas per year.
- Close to $US1 billion was announced for a 396MW wind project in Oaxaca State, Mexico.
- After the shift away from a nuclear power-dependent energy policy in the wake of the Fukushima nuclear accident, TEPCO commissioned its first three solar plants in 2011 and 2012 at Kawasaki and Mt. Komekura for a total of 30MW.
- Warren Buffett’s MidAmerican Holdings launched an $850 million bond issue in February 2012 to finance its 550MW Topaz Solar Farm in California, only to see it oversubscribed by more than $400 million.
- $US5 billion of ‘green’ bonds were issued in 2012, a 44 per cent increase over 2011.
- The phenomenon of crowd sourcing—in which capital is raised from large numbers of small investors—took off in small-scale solar in Europe and the United States.
“The uptake of renewable energies continues worldwide as countries, companies and communities seize the linkages between low-carbon green economies and a future of energy access and security,” UN Environment Program Executive Director Achim Steiner said in the statement. “More and more countries are set to take the renewable energy stage,” he said, citing “the logic and the rationale of embracing a green development path.”
UNEP and the Frankfurt School of Finance and Management worked with Bloomberg New Energy Finance to produce one of today’s reports, while REN21, an association of scientists, governments and international organisations, wrote the other.
Total global investment in renewables fell to $US244 billion in 2012 from $US279 billion in 2011, due in part to a drop in the cost of solar and wind technologies, according to the reports. Solar photovoltaic installations rose to a record 30.5 gigawatts. Wind also hit a new annual record, with 48.4 gigawatts put in place.
There were particularly sharp increases in renewables investment in South Africa, Morocco, Mexico, Chile and Kenya, with Middle East and Africa showing the highest regional growth of 228 per cent to $US12 billion. The U.S., which led the world in 2011, fell behind China, with investment dipping 34 per cent to $US36 billion.
In Germany, spending fell 35 per cent to $US20 billion. In Japan it surged 73 per cent to $US16 billion as the government introduced subsidies for wind, solar and geothermal power following the earthquake in 2011 that closed most of the nation’s nuclear reactors.
“It is encouraging that renewable energy investment has exceeded $US200 billion for the third successive year, that emerging economies are playing a larger and larger part, and that the cost-competitiveness of solar and wind power is improving all the time,” said New Energy Finance Chief Executive Officer Michael Liebreich. “What remains daunting is that the world has hardly scratched the surface. CO2 emissions are still on a firm upward.”