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Renewables 2011 Global Status Report | REN21

Renewables 2011 Global Status Report | REN21

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Published by Uğur Özkan
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Germany

USA

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China

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Brazil

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Italy

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Total global investment in renewable energy –
Total global investment in renewable energy –
Total global investment in renewable energy –
Total global investment in renewable energy –
including financial new investment and small-scale
including financial new investment and small-scale
investment – jumped in 2010 to a record $211 billion.
China attracted nearly $50 billion, making it the
leader for the second year in a row.

02

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02 InVeSTMenT flOwS

InVeSTMenT flOwS

I) This section is derived from UNEP, Global Trends in Renewable Energy Investment 2011 (Paris, 2011), the sister publication to the GSR. The
figures are based on the output of Bloomberg New Energy Finance’s (BNEF) database unless otherwise noted. The following renewable energy
projects are included: all biomass, geothermal, and wind generation projects of more than 1 MW, all hydro projects of between 0.5 and 50 MW,
all solar power projects of more than 0.3 MW, all ocean energy projects, and all biofuel projects with a capacity of 1 million liters or more per
year. BNEF defines utility-scale solar parks as greater than 500 kW in capacity. For more detail, please refer to the UNEP Global Trends report.
Note that all dollar and cents figures in this report are in U.S. dollars unless otherwise indicated.
II) Revised upward from $150 billion as reported in the Renewables 2010 Global Status Report.
III) In this section, waste-to-energy includes all waste-to-power technologies, but not waste-to-gas.

Total investment in renewable energy reached $211
billion in 2010,I

up from $160 billion in 2009,II
including reported asset finance, venture capital, private
equity investment, public markets (stock purchases),
and corporate and government research and develop-
ment. (See Figure 12.) If the unreported $15 billion
(estimated) invested in solar hot water collectors is
included, then total investment exceeded $226 billion.
An additional $40–45 billion was invested in large
hydropower.
If only total investment in new renewable energy capacity
(excluding large hydro) is counted, the total comes to
$203 billion. This $203 billion includes utility-scale
asset finance (large wind farms, solar parks, and biofuel
plants), distributed generation capacity (mostly rooftop
solar PV less than 1 MW in size), and hot water/heating
capacity. Within the overall figure, financial new invest-
ment, which consists of money invested in renewable
energy companies and utility-scale generation and
biofuel projects, rose 17% in 2010 to $143 billion.

n Investment by Region

The top countries for total investment in 2010 were
China, Germany, the United States, Italy, and Brazil. For
the first time, financial new investment in renew-
able energy in developing countries surpassed that in
developed economies. (Note that in the two areas not
included in the financial new investment measure,
namely small-scale projects and R&D, developed
countries remain well ahead.) Financial new investment

rose $17 billion to more than $72 billion, while in OECD
countries it increased less than $4 billion to $70.5
billion. China attracted $49 billion (up 28% over 2009),
which was more than two-thirds of developing country
investment and more than a third of global investment in
renewable energy during 2010, making China the leader
for the second year in a row. The United States ranked
second for financial new investment, with just over $25
billion, an increase of 58% over 2009. Germany enjoyed
financial new investment of $6.7 billion in 2010, but this
was dwarfed by its $34.3 billion in small-scale projects,
mainly rooftop solar PV.
Although total financial new investment was higher in
developing countries, growth rates in a number of devel-
oped countries exceeded those in some major developing
economies. For example, Belgium saw an increase in
investment of 40%, Canada 47%, Italy 248 %, and the
United States 58%, whereas growth rates in India and
Brazil were 25% and minus 5%, respectively. Italy moved
from ninth to third place in global renewable energy
investment as asset finance in solar PV surged on the
back of generous feed-in tariffs.
Increases in developing countries, as well as in the
United States, were due to an increase in asset finance,
dominated by wind, for which global asset finance rose
by $23 billion to $90 billion.
China’s lead was due mainly to the growth in wind
power capacity in 2010. China continued to benefit from
a $46 billion “green” stimulus package, which had been
announced at the height of the financial crisis in 2008.
By the end of 2010, 70% of the funds had been spent,
although data about the details are unclear. China also
dominated public markets, with $5.9 billion (out of the
total $49 billion) in new investment in renewables.
India ranked eighth in the world for renewable energy
investment. Investment rose 25% to $3.8 billion, domi-
nated by wind power projects ($2.3 billion), followed
by $400 million each for solar and biomass power
(including waste-to-energy

).III
In Brazil, new investment dropped 5% to $7 billion.
This seemingly weak performance can be explained by
the fact that the focus was on consolidating the biofuel
sector, so that most money went into mergers and
acquisitions, which does not count as new investment.
Latin America (excluding Brazil) saw the biggest absolute
increase in renewable energy investment among the
regions of the developing world. The largest gain within
Latin America was achieved by Mexico (348%). This

250

200

150

100

50

0

Billion US Dollars

2004 2005 2006 2007 2008 2009 2010

211

160

103.5

62.8
62.8

22

40.9
40.9

130
130

figure 12. Global new Investment in Renewable
energy, 2004–2010

RENEW

ABLES 2011 GlObal STaTuS RePORT

growth was a result of the successful financing of large
wind projects and one geothermal project following the
government’s 2009 announcement that it was increasing
its renewables target from 3.3% to 7.6 % by 2012.
Argentina saw investment increase by 568%, to $740
million; Peru’s investment doubled to $480 million;
and Chile saw a 21% increase to $960 million.
Africa achieved the largest percent increase in renewable
energy investment among developing country regions
apart from China, India, and Brazil. Total investment rose
from $750 million to $3.6 billion, largely as a result of
strong performances in Egypt and Kenya.

n Investment by Type

Asset finance of new utility-scale renewable energy
projects (wind farms, solar parks, biofuel and solar
thermal plants), the largest investment asset class,
reached a record $128 billion in 2010, or almost 60% of
the total. This represents an increase of 20% over 2009,
which had seen a drop of 6% compared to 2008.
The resumption of utility-scale asset finance growth in
2010 is due mainly to the Asia and Oceania region, which
accounted for about 44% of the total new-build asset
finance during the year. China in particular took first
place in new-build clean energy in 2010, with asset
finance of $43.8 billion, the largest for any single country.
The United States was second on the list, with $19.6
billion in asset finance, or less than half that of China.
China and the United States together accounted for more
than half of the total new-build asset finance in 2010.
Several European countries, led by Germany, Italy, and
Spain, were among the top 15 countries. So were Brazil,
Canada, India, and Mexico. Asset finance for the 3rd- to
15th-ranked countries ranged from $1.4 billion (Poland)
to $6.9 billion (Brazil).
Wind power dominated the utility-scale asset finance
sector (70%), with $90 billion invested in projects, a
33% rise over 2009. Large-scale solar power plants
represented the second largest sector under utility-scale
asset financing, at $19 billion in 2010. This was about 5%
higher than the financing secured in 2009, although still
below the 2008 record of $23 billion due to the sharp
decline in PV panel prices.
Geothermal also saw an increase in asset finance in 2010
compared to 2009. Financing for biomass (including
waste-to-energy), biofuels, small hydro, and ocean power
in 2010 was lower than it was the previous year. Asset
financing for biomass (including waste-to-energy) was
down 10% to $10.2 billion in 2010. The sector contin-
ued to be plagued by feedstock supply challenges and
uncertainty over future feedstock prices.
The biofuel sector saw a 19% drop in asset finance, to
$4.7 billion. This was one quarter of the $20 billion of
asset financing that the sector secured in 2007, and less
than one third of the 2008 amount ($16 billion). The
downward trend was driven by lower crude oil prices in

2010 and by uncertainty over feedstock supplies.
Financing for small-scale hydropower was down 43%,
to $2 billion, hit by a post-financial crisis lull, regulatory
restrictions in Europe, and concerns about the risk of
rainfall variations affecting the performance of some
projects.
Ocean energy continued to be at an immature stage of
development, managing just $40 million of asset financ-
ing. However, ambitious plans emerged during 2010 for
multi-MW projects off the coasts of countries such as the
U.K. and Portugal.
Other types of investment activities in 2010 were notable
as well. Venture capital and private equity investment
in renewable energy companies increased 19% over
2009, to $5.5 billion, despite a significant drop in the
third quarter of the year. All of the growth was in venture
capital (both early and late stage), while private equity
expansion capital continued to drop, following the trend
in 2009. Early-stage venture capital rose 41% to $930
million, and late-stage venture capital increased 71%
to $1.5 billion. Early-stage venture capital was still 38%
below its 2008 peak, but late-stage established a new
record high, almost 9% above its 2008 level.
Meanwhile, investment of private equity expansion
capital dropped by $20 million, to $3.1 billion, following
the decline in 2009, and was less than half the value of
its 2008 peak. Private equity continued to face challen-
ges over fundraising, valuations, and exits in 2010. The
regional leader in venture capital and private equity
investment was North America. In terms of technology,
most investment went into solar.
Renewable energy investment in public markets in-
creased 23% in 2010, to $15.4 billion, an increase over
the previous year. Research and development (R&D) on
renewable energy rose to $9 billion in 2010, with most
R&D worldwide going into solar ($3.6 billion) followed
by biofuels ($2.3 billion). For the first time, governments
spent more on R&D for renewables ($5 billion, up from
$2 billion in 2009) than the private sector did ($3 billion,
down from $4 billion in 2009). This is because green
stimulus money was still being spent during 2010, most
strongly in Asia and Oceania (excluding China and India),
where government R&D investment in renewable energy
increased 27-fold spurred by national stimulus packages
in Australia, Japan, and South Korea.
In 2010, $60 billion was invested in small-scale distrib-
uted generation projects, accounting for more than 25%
of total investment in renewable energy. This small-scale
investment was largely solar PV, which is benefiting from
generous support programs, falling prices for solar mod-
ules, and a growing base of installers that are marketing
to consumers. Bloomberg New Energy Finance (BNEF)
estimates that 86% of the investment in small-scale solar
took place in countries that have introduced feed-in
tariffs. Germany, which continues to have the world’s
largest solar PV market, took the lead with a 57% global
investment share. Counting both utility-scale solar

36

InVeSTMenT flOwS

02

and small-scale solar, total solar power investment in
2010 grew to $79 billion, driven largely by distributed
generation projects in Europe.
There are no reliable figures for the value of investment
in solar water heaters worldwideI

, but on the basis of
installation, investment can be estimated at around $15
billion.

n Development and National Bank Finance

State-owned multilateral and bilateral development
banks have been pillars of investment in renewable energy
during recent, troubled years for the world economy. In
2010, more public money went to the renewable energy
sector through development banks than through govern-
ment stimulus packages.
Data compiled by BNEF show that 13 development banks
worldwide provided $13.5 billion of finance for renew-
able energy projects in 2010, up from $8.9 billion in
2009, $11 billion in 2008, and just $4.5 billionII

in 2007.
Almost all of this funding took the form of loans, although
there were also a few equity finance deals, notably in
Eastern Europe by the European Bank for Reconstruction
and Development (EBRD).
The three leading development banks, in terms of financ-
ing of renewables projects in 2010, were the European
Investment Bank ($5.4 billion), Brazil’s BNDES ($3.1
billion), and Germany’s KfW ($1.5 billion). The EIB’s
contribution grew almost fivefold between 2007 and
2010. BNDES’s activity in 2010 was double its 2007
level, but the bank’s contribution actually peaked at
$6.2 billion in 2008, when Brazil’s ethanol investment
boom was at its height. KfW’s project finance footprint
doubled as well between 2007 and 2010.
The Asian Development Bank (ADB) invested $819
million in renewable energy projects in 2010. The
World Bank Group committed $748 million in direct
renewable energy project finance, with over two-thirds
of this coming from loans from the International Bank
for Reconstruction and Development (IBRD) and the
International Development Association (IDA). Roughly a
third came from the International Finance Corporation
(IFC), much of it to energy efficiency projects (which are
not covered in this report).
One uncertainty relates to the China Development Bank,
which in 2010 announced some $36 billion in credit lines
to Chinese clean energy manufacturers. However, CDB
shows up as the confirmed lender to only some $600
million of renewable energy projects. It is likely that the
bank’s contribution to projects is much larger than has
been revealed as of publication of this report.
The Global Environment Facility (GEF), which was not
included in the BNEF analysis, approved funding in 2010
for 25 renewable energy projects, with a total direct GEF
contribution of $40.4 million. Total co-financing for these
projects from all sources was $382.1 million.

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