Global economic turmoil and solar company bankruptcies be damned -- economies of scale and falling prices are keeping green energy growing. That’s according to research firm Clean Edge, which reported Tuesday that global revenue for solar PV, wind power and biofuels rose 31 percent to reach $246 billion in 2011.

Clean Edge put the global solar market at $91.6 billion in 2011, up from $71.2 billion in 2010. That outpaced wind power’s growth to $71.5 billion in 2011, up from $60.5 billion in the previous year. The global biofuel market grew to $83 billion in 2011, up from $56.4 billion in 2010, though that was largely due to a big increase in biofuel prices, Clean Edge reported.

In solar power, on the other hand, costs of solar panels fell by more than 40 percent last year, while installations grew by 69 percent, yielding a 29-percent increase in solar market revenues last year, Clean Edge reported.

2011’s green energy market growth came alongside an increase in investment in the clean energy sector, which rose 5 percent from 2010 to a record $260 billion last year, Bloomberg New Energy Finance reported in January.

In that total, solar energy investment jumped 36 percent to $136.6 billion to take the lead over wind power for a second year, driven by solar panel prices that fell by about 50 percent last year and made projects more attractive to investors.

Of course, we’re all familiar with the downside to the solar industry price wars, largely driven by Chinese companies, in the form of the collapse of companies that couldn’t compete and a looming solar trade war between China and the United States.

But the pricing challenges in the solar industry that have led Solyndra and many other PV manufacturers to ruin in the past year are also driving down the cost of solar power to boost deployment -- and, in some cases, are pushing solar power down to price ranges in which it can compete with grid power.

Clean Edge calculated that complete solar PV systems were being installed globally in 2011 at an average cost of $3.47 a peak watt or 14 cents to 23 cents per kWh, competitive in markets like Hawaii, California, New Jersey and the Northeast under certain conditions. By 2020, the firm predicts that solar PV’s levelized cost of energy (LCOE) will fall to less than half its current figures, which should make solar power price-competitive with grid power in 13 states.

The nuclear power industry’s continuing troubles are another key factor driving solar power’s competitiveness, Clean Edge notes. Japan’s Fukushima nuclear power plant disaster last year has led to a massive shift against nuclear power, with key governments (e.g., Germany, Switzerland) planning to phase out nuclear plants, China halting construction of 25 reactors and Japan taking all but a handful of its nuclear plants off-line. In the United States, promised loan guarantees for new nuclear plant projects are being held up.

Japan in particular is struggling to replace the roughly 30 percent of the nation’s power that came from nuclear with clean and renewable resources, to be supported in part with a generous national feed-in tariff program set to start this summer.

That’s led to a massive increase in renewable energy projects in Japan, including Mitsui and Toshiba’s proposed 50-megawatt solar power plant, and Softbank entrepreneur and telecom billionaire Masayoshi Son’s plan to invest close to $1 billion to build 10 utility-scale power plants across the country. Japanese solar players like Sharp, Panasonic/Sanyo and Solar Frontier, which ranked second behind First Solar in thin film solar panels shipped in 2011, could be at the forefront of that expansion, Clean Edge noted.

Beyond broad market trends, the report also highlighted several trends in green technology, including the U.S. military’s big push into energy innovation; the importance of building energy efficiency “deep retrofits” in balancing power demand with supply; the rise of waste-to-energy efforts by startups like Agilyx and big investors like trash giant Waste Management; and the implications of new energy storage technologies in balancing intermittent wind and solar power.

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