GLOBE-Net, January 4, 2012 - In December
2011 Bloomberg New Energy Finance reported that the one trillionth
dollar of investment in clean energy had been spent since it began
keeping records on such spending in 2004.
This milestone was significant noted Bloomberg, because it
happened just as negotiators and world leaders were gathering in
Durban for the latest round of international climate
negotiations.
A key item on the Durban agenda was the management of a fund
designed to promote clean energy investment in the developing
world.
Where that trillionth dollar was spent was uncertain, but most
probably it happened somewhere in the developing world, said
Bloomberg, where record levels of clean energy investment are
taking place.
According to the firm's latest Global Renewable Energy
Market Outlook, which examines the size of the world renewable
energy markets out to 2030, the most rapid growth will be
seen in the rapidly developing economies of India, the Middle East,
Africa and Latin America, with projected growth rates of 10-18% per
year over the period 2010 to 2020,
Geographically, Europe will remain one of the biggest markets
for money spent on renewable energy projects for the next three
years, says the company, but with a dwindling share of world
investment as European Union governments scale back clean energy
support in the face of sovereign debt problems.
According to the analysis in 20 years' time 15.7% of total
energy production will come from renewable sources (including large
hydro), up from 12.6% last year.
The Bloomberg report predicts that spending on new renewable
energy capacity will total $7 trillion over next 20 years and the
annual value of installed renewable energy capacity will double in
real terms to $395bn in 2020, rising to $460bn in 2030.
With regard to technologies, Bloomberg predicts cost reductions
will spur deployment of solar power, which will undergo the
second-fastest percentage growth of all technologies (after
offshore wind) from 51GW in 2010 to 1,137GW by 2030.
This will require significant capital - an annual average of
$130bn over 2010-30 compared with $86bn in 2010. China will
take over the lead in renewable energy asset finance from Europe in
2014 with an annual spend of just under $50bn. The US and Canada
are also expected to see no slowdown in project construction,
together hitting $50bn of investment in 2020.
The wind sector - both on and offshore - will continue to
expand, attracting $140bn in 2020 and $206bn per annum by 2030
(2010: $82bn). New areas of growth will come from European offshore
wind and emerging markets in Latin America, Turkey, Africa and
Australia.
In those countries, a favourable combination of good resources
and underlying power demand growth will combine with a desire to
diversify the energy mix.
The
bioenergy sector will see renewed activity, with the
commercialisation of second-generation technologies. Investment in
biofuels, biomass and waste-to-energy is projected to increase from
$14bn in 2010 to $80bn in 2020 and then remain level over the next
decade.
Guy Turner, director of commodity market research at Bloomberg
New Energy Finance, said "These results indicate that last year's
record renewable energy investment was no one-off despite the
recent economic gloom."
Big winners over the next 20 years will be the emerging
renewable energy hubs in Latin America, Asia, the Middle East and
Africa - by 2020 the markets outside of the EU, US, Canada and
China will account for 50% of global annual investment in renewable
energy capacity."
"The trillionth-dollar milestone shows that the world is not
waiting for a deal on climate in order to start turning the
super-tanker away from fossil fuels," said Bloomberg New Energy
Finance chief executive Michael Liebreich.
"Another five years of investment growth at the same compound
rates, and the world will have broken the back of emissions
growth," he added.
As capital costs for wind, solar, geothermal, marine, hydro and
bioenergy continue to fall, and as energy smart technologies remake
the world's grids, clean energy investment flows are expected to
maintain their long-term rise, supported by a network of policies
and initiatives around the world, he noted.
Recalibrating the Global Mix
Despite the efforts to usher in clean, renewable energy,
no single energy technology or strategy is going to result in the
dramatic emission reductions that are necessary across the
globe.
Instead, the world's demand for energy will require a
recalibration of the supply portfolio that will consist of a
combination of sources including fossil fuels and renewables. At
GLOBE 2012, taking place March 14-16,
2012, senior executives from leading international energy
companies to discuss the future global energy mix in a
special Energy Leaders Dialogue. Get More
information on GLOBE 2012 here