Indeed the IHT noticed a drop in stocks of these companies and Les Echos reported a fear that the French government might not respect its Grenelle’s commitments.
Indeed, as the economies worldwide seem to slow done, renewables might suffer the most as they still don’t represent the priority they should be.
According to the Business of Green blog from the International Herald Tribune :
For the past couple of years, scientists at the United Nations have been warning that the world needs new technology to deliver clean energy. But that has not been enough to create bullet-proof investments. Some technologies thought to have been among the most promising, including biofuels, solar energy and those aimed at energy efficiency, have turned out to be the worst affected.
Clean energy stocks have been falling fast, faster than other leading U.S. indexes like Nasdaq and the S&P 500 in the first quarter. Many companies have canceled plans to list on stock markets.
In fact, experts saw the slump coming.
Michael Liebreich of New Energy Finance told me earlier this year that certain sectors of the green energy business were badly overheated and due for a correction. He also has pointed out that sectors that had proved their viability — Brazilian ethanol, wind farms and hydropower for example — have been performing comparatively well.
“The fundamental drivers for investment in clean energy remain strong,” Liebreich wrote in a note to clients this week, even as he suggested that governments need “to spend much more to meet their own ambitious targets on renewable energy.”
The question now is whether the enthusiasm that governments have shown for things green can survive the severity of the current economic downturn. With recession looming in the United States, and chaos showing few signs of abating in the financial markets, governments may think twice about spending the amounts of money needed to make the much vaunted clean energy revolution a reality.
Concerning the situation in France, Les Echos stated that the Syndicate of Renewable Energies is fearing that the government may decrease its goals or energy production from renewables as the money is lacking.
According to this authority, they need public spending of more than 2.5 billion euros per annum by 2020 to reach the goals of 23 % of total energy generation.
This money would be well spent as it bring four billion euros of fiscal incomes as well as the creation of 120,000 jobs in France alone as well as enabling the country to avoid paying fines for not respecting the Kyoto Protocol commitments.
Last but not least, this would enable French households to save six billion euros on their energy bills.
And you, what do you think about the threat of recession regarding renewables ? In any case, be sure that I will keep you posted on this topic.
So, for this and for much more, stay tuned and don’t hesitate to leave your opinion !