Investments in Renewable Energy Keep Rising Despite the Financial Meltdown

Global investments in clean energy during 2008 are topping out 2007's record numbers. The effect of the financial crisis is slowing down the record breaking growth from the last couple of years. China and Brazil are two of the countries that kept the investment numbers high when the U.S and EU struggled with the economic downfall.

The Global Trends in Sustainable Energy Investment 2009 Report from the EUEP shows that $155 billion was invested in clean energy companies worldwide during 2008.

“Investment in the United States fell by two per cent and in Europe growth was very much muted. However, there were also some bright points in 2008 especially in developing economies, said Achim Steiner, UN Under-Secretary General and UNEP Executive Director, in a statement. “China became the world's second largest wind market in terms of new capacity and the world's biggest photovoltaic manufacturer and a rise in geothermal energy may be getting underway in countries from Australia to Japan and Kenya".

The report also claims that renewables accounted for over 40 percent of the added power generation capacity last year, and the majority of the investments.

The investments coming from stimulus packages from leading governments were $180 billion in total. The drop in global interest rates also created a big stimulus. The report points out, however, how banks are being worried about solvency to lend. At the same time, renewable energy projects are expected to be first in line when lending starts to flow again. The authors of the report think renewable energy projects will be attractive since they produce a reliable stream of revenues from the utilities.

Wind power tops investment during 2008, but solar power gained the most revenues. Solar is also the industry that holds the majority of incubated companies. Twenty-one percent of the total number of incubated companies were within that sector, and it’s followed by wind, biofuels and energy effiency supply and demand side sectors.

Breaking down the overall investments, $105 billion was spent developing 40 gigawatt of power generating capacity from wind, solar, small-hydro, biomass and geothermal sources. Hydropower got a further investment of $35 billion, developing 25 gigawatts of power.