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06/13/2012 03:19 PM     print story email story  

Solar Surpasses Wind as Top Renewable Energy Investment News

Not only did solar installations soar in the US this past quarter, but solar surpassed wind as the top renewable energy investment worldwide in 2011, according to twin reports from the United Nations Environment Programme (UNEP) and the Renewable Energy Policy Network for the 21st Century (REN21).

Solar attracted almost twice as much investment as did wind, jumping 52% to $147 billion, led by booming rooftop PV installations in Italy and Germany. Small-scale PV also spread in countries like the UK and China and there were significant investments in large-scale concentrating solar projects in Spain and the US.

On the other hand, it was a mixed bag for solar venture capital
and stocks on the public markets have been crushed because of falling subsidies and the impact of oversupply and low prices on manufacturers.

Investments in renewable energy rose 17% to a record $257 million, a six-fold increase from 2004 and 94% higher than 2007, the year before the world financial crisis took hold, according to UNEP.

Although last year's 17% increase was much smaller than the 37% growth recorded in 2010, it was achieved at a time of rapidly falling prices for renewable energy equipment and severe pressure on fiscal budgets in the developed world.

In 2011, renewable energy supplied 16.7% of global energy consumption as 118 countries implemented targets, more than half of those in developing countries.

Excluding large hydro, renewable energy accounted for 44% of all new generating capacity added worldwide, up from 34% in 2010. 40% of new capacity was in wind and 30% in solar PV.

During 2011, worldwide installation of renewable energy grew to 1,360 GW, 8% higher than 2010.

Solar panel prices dropped 50% and onshore wind turbines by close to 10%, bringing the price of these technologies closer to grid parity with fossil fuels.

In fact, rooftop PV is already competitive with retail daytime electricity prices in Germany, Denmark, Italy and Spain, and the state of Hawaii.

Leading Regions

In China, solar grew 17% representing $52 billion in investment, but the US came very close to that with its 57% leap to $51 billion, as developers took advantage of expiring incentives.

India also showed impressive growth of 62% to $12 billion in investment and Brazil grew 8% to $7 billion.

The top seven countries in renewable energy capacity (excluding large hydro) account for 70% of the market: China, US, Germany, Spain, Italy, India and Japan. Europe has 37% of that capacity.

In Europe, solar was the most installed energy source, renewable or not, increasing 63% to 21.9 GW, more than wind and natural gas combined, according to the European Photovoltaic Industry Association.

In 2011, European nations installed 75% of global capacity and if solar and wind installations remain stable in 2012, they would supply enough electricity to compensate for closing Germany's nuclear reactors.

In fact, US-based First Solar announced it would postpone closing its German plant because demand has remained so strong.

What's Next

Expired incentives in the US and feed-in tariff cuts in Europe are widely expected to surpress growth there in 2013.

China will be the biggest solar PV market in 2013 and its largest manufacturers are ramping production to meet expected demand.

Even with the world supply glut, Suntech plans to increase shipments 27% and Yingli Green Energy 37% from 2011 levels, according to Bloomberg.

China may install as much as 5.5 GW in 2012 and 2013, while Germany's target is just 2.5 GW next year.

Japan, the world's sixth largest market, is also headed for a boom. It could install 4.6 GW in 2013 - it's solar feed-in tariff goes into effect July 1.

But "In almost every year you look, forecasters' cost-reduction assumptions and demand forecasts are too conservative," Daniel Guttmann, head of renewable strategy at PricewaterhouseCoopers, told Bloomberg.


UNEP's Global Trends in Renewable Energy
REN21's Renewables Global Status Report:


Reader Comments (2)

Kyle Sager

Date Posted:
06/13/12 01:57 AM

A very big challenge for solar power in the coming decade will be in simply informing populations repeatedly that their rights are being compromised when they are restricted from using PPA financing for solar on their own rooftops. This needs to be repeated over and over until people begin understanding the simplicity of PPA vehicles automatically because they've heard about them enough to grasp the basics. The spin game against solar is simple: The bulk power industry is relying on the fact that it sells power in tiny slices (kilowatt hours) that make thinking about capital investments hard. So the power companies simply chant "solar's too expensive" over and over to keep customers from examining what will happen if laws changed. The good news is solar's cost is not going to stop dropping. The 30 year decline is intrinsic to the technology. What this means is: continuous loud education about PPAs will eventually penetrate; but the education has to be relentless and loud. In Georgia, for example, Southern Company (Georgia Power) fought very hard in 2012 to claim that residents' rooftops are it's territory and not their own for deciding who they do business with (PPAs). It would not fight that hard if if did not fear the changes coming; but that does not excuse Georgia Power, Southern Company, or the georgia state legislature from burying senate bill SB-401 and trampling homeowners rights by restricting them from choosing how panels on their own rooftops are financed. kyle sager

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M. Straub

Date Posted:
06/14/12 04:44 PM

Kudos to those embracing solar on the largest of scales. Better to make the investment renewables today, before we're forced to down the road thanks to out of control fossil fuel costs. Wind and solar have done their job and locked renewables into the market place, but to really raise those 'overall electricity production' numbers from renewables, countries need to embrace more of the innovations gaining momentum every day. A long established form that is just starting to gain a foothold in the market is Ocean Thermal Energy Conversion (OTEC). It creates an endless flow of power from the temperature difference in shallow an deep water. It is emission free, works 24/7/365, and is affordable. Plus, the only byproduct of an OTEC system is millions of gallons of clean drinking water. OTEC is on it's way to coastal regions around the world, and could drastically cut fossil fuel dependency for millions. To see more on how OTEC works, and the people making it happen check out the On Project.

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