Investment reached last year $148 billion (93 billion euros) and this trend is most likely to continue as forecasts mention $600 billion per year by 2020.
As we can see, a sheer revolution is taking place and this new report strongly reinforces my willingness to work in this sector.
According to the UNEP press release :
Climate change worries, growing support from world governments, rising oil prices and ongoing energy security concerns combined to fuel another record-setting year of investment in the renewable energy and energy efficiency industries in 2007, according to an analysis issued Tuesday July 1 by the UN Environment Programme (UNEP).
“The clean energy industry is maturing and its backers remain bullish. These findings should empower governments-both North and South-to reach a deep and meaningful new agreement by the crucial climate convention meeting in Copenhagen in late 2009,” Achim Steiner, the head of UNEP, says.
Over $148 billion in new funding entered the sustainable energy sector globally last year, up 60% from 2006, even as a credit crunch began to roil financial markets, according to the report, “Global Trends in Sustainable Energy Investment 2008,” prepared by UK-based New Energy Finance for UNEP’s Paris-based Sustainable Energy Finance Initiative.
Wind energy again attracted the most investment($50.2 billion in 2007), but solar power grew most rapidly:attracting some $28.6 billion of new capital and growing at an average annual rate of 254% since 2004, driven by the advent of larger project financings.
(…) “Just as thousands were drawn to California and the Klondike in the late 1800s, the green energy gold rush is attracting legions of modern day prospectors in all parts of the globe,”says Mr Steiner, who is also a UN Under-Secretary General.
“A century later, the key difference is that a higher proportion of those looking for riches today may find them. With world temperatures and fossil fuel prices climbing higher, it is increasingly obvious to the public and investors alike that the transition to a low-carbon society is both a global imperative and an inevitability. This is attracting an enormous inflow of capital, talent and technology. But it is only inevitable if creative market mechanisms and public policy continue to evolve to liberate rather than frustrate this clean energy dawn.
“What is unfolding is nothing less than a fundamental transformation of the world’s energy infrastructure.”
Most of the new money flowed into Europe, followed by the USA. However, China, India and Brazil draw growing investor interest, their share of new investment growing from 12% in 2004 to 22% in 2007, an increase in absolute terms of 14 times, from $1.8 billion to $26 billion.
Total 2007 sustainable energy transaction volume was $204.9 billion, of which $98.2 billion went into new renewable energy generation (especially wind in the US, China and Spain), $50.1 billion went into technology development and manufacturing scale-up, and $56.6 billion changed hands through mergers and acquisitions.
With 31 gigawatts of new installed generation, sustainable energy accounted for 23% of new power capacity added globally in 2007, about 10 times that of nuclear.
Sustainable energy companies accounted for 19% of all new capital raised by the energy sector on the global stock markets in 2007.
“Investment in the sustainable energy sectors must continue to grow strongly if targets for greenhouse gas reductions and renewables and efficiency increases are to be met,”says the report.
“Investment between now and 2030 is expected to reach $450 billion a year by 2012, rising to more than $600 billion a year from 2020. The sector’s overall performance during 2007 and into 2008 sets it on track to achieve these levels.”
Says Michael Liebreich, CEO of New Energy Finance Ltd, a leading provider of research and analysis on the clean energy and carbon markets and co-author of the report: “2007 was a banner year for the clean energy industry. Wind continued its strong progress, with installed capacity passing the 100 GW mark.
Solar is maturing rapidly, with heavy investment to ease the silicon bottleneck and new thin-film technology beginning to reach scale. And there are plenty of other technologies lining up to be the next ones to begin a real march to scale-including biomass and geothermal.
Carbon Capture and Storage (CCS) is the only sector where we did not see as much progress as we had expected, with the regulatory and funding environments for these projects remaining murky and timelines for the first commercial projects being extended.”
The press release gives further data for specific countries and energies and I strongly invite you to have a look at it if you are into renewable energies.
If you wanted even more data on this matter, you can download the full report here ( registration required )