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Solar power 'drove rebound in green energy spending' in 2014

Solar power 'drove rebound in green energy spending' in 2014

Solar power 'drove rebound in green energy spending' in 2014

Global spending on green energy reached a three-year high in 2014, according to new data - even after a collapse in oil prices was tipped to spell trouble for the renewables market.

A report from Bloomberg New Energy Finance, published on Friday (January 9th), revealed that investment in non-fossil fuel energy worldwide totalled $310 billion (£205 billion) over the 12-month period - the market's best performance since 2011.

The figure represents an impressive 16 per cent increase on spending in 2013, when $268 billion was invested in global green energy projects, and beat Bloomberg's expectations for what would have already been a significant rebound of ten per cent.

It also means that in the past decade, the market has grown to more than five times the $60.2 billion registered in 2004.

Commenting on the launch of the data, Bloomberg New Energy Finance advisory board chairman Michael Leibreich noted that while the year saw a record $19.4 billion of financing for offshore wind projects, new demand for large-scale and rooftop solar power was "the biggest single contributor" to the above-estimate rise in market value.

"Throughout last year, we were predicting that global investment would bounce back at least ten per cent in 2014, but these figures have exceeded our expectations," he commented, adding: "Healthy investment in clean energy may surprise some commentators, who have been predicting trouble for renewables as a result of the oil price collapse since last summer. Our answer is that ... the impact of cheaper crude will be felt much more in road transport than in electricity generation."

On a region-by-region basis, Bloomberg praised China for an extraordinary 32 per cent uptick in spending to a record $89.5 billion. The US achieved its highest investment in green energy since 2012, allocating $51.8 billion to solar and wind projects over the 12-month period - a year-on-year increase of eight per cent.

Europe, disappointingly, was described as a "dull spot", with spending edging up just one per cent to $66 billion.

According to Bloomberg, the second-largest category of investment worldwide - after asset finance of renewable energy projects - was small distributed capacity, which describes systems that generate less than one megawatt of power. Some $73.5 billion was invested in this area in 2014, an increase of 34 per cent year on year that reflects the growing affordability of rooftop solar panels - the source of renewable energy that made up the bulk of the category.

When larger-scale projects were also considered, solar power made up almost half of global green energy spending, with $149.6 billion committed in total - up 25 per cent on 2013 and its biggest share ever. Noting this, Mr Liebreich cited "huge improvements in its cost-competitiveness over the last five years" as the driving factor.

A similar observation was recently made by Berlin-based thinktank Thema1, which forecast in a December report that solar power would become a competitive energy source in the UK by 2020 - even without government subsidies.

Gerard Reid, the author of the study, said: "We are firmly convinced that solar will become the bedrock of the global power system going forward."

 

Posted by Julie Tucker