Small, Rooftop Solar Shines in Q2 Clean Energy Investments

Small-scale solar rose in influence in clean energy investments in the second quarter (Q2) 2012 and China claimed "star performer" status, according to Bloomberg New Energy Finance.

Overall, clean energy showed resilience in the face of economic and political uncertainty generating new worldwide  investments of $59.6 billion, up 24% over the first quarter, but still 18% below the near-record $72.5 billion in Q2 last year.

Solar projects accounted for $33.6 billion of that total, up 19% from the first quarter. That compares with $21.6 billion for wind, up 47%.

Although investments in larger projects remain robust, the data underscores the growing importance of small-scale solar installations. Projects of less than 1 megawatt (MW), such as rooftop solar photovoltaics (PV), were worth an estimated $21.5 billion, up 13% over the year-earlier quarter. 

California just passed the 1.2 gigawatts (GW) mark for small rooftop PV.

While Germany and Italy are still the largest markets for small-scale solar, installations are growing strongly in the US, Japan and China.

Speaking of China, it was the "star performer" for the second quarter, investing $18.3 billion, up 92% over the previous quarter. Given the country’s new plan to boost domestic installations to 21 GW by 2015, that momentum will continue.

The largest Chinese solar project financed in the quarter was the $316 million going to the Shanlu & Shengyu Bayannur Wuyuan photovoltaic plant.

"These figures underline the pivotal role China is playing in the clean energy sector," says Michael Liebreich, New Energy CEO. "Its torrent of supply-side investment was one of the main reasons why renewable energy costs have been plummeting; we are now seeing China creating enough demand to start mopping up some of the resulting overcapacity."

Other key findings:

  • Europe and the US recorded solid investment gains,  reaching $20 billion and $10.2 billion, up 11% and 18%, respectively.
  • Public market investment in clean energy was just $1.2 billion, off 75% from Q2 2011.
  • Venture capital and private equity accounted for $1.5 billion, off 39% from Q2 2011.
  • Asset finance for utility scale renewable power and fuel projects rebounded to $35 billionff. That was off 24% from a year ago, but up 50% from Q1 2012.
  • Among the smaller clean energy sectors, biomass and waste-to-energy received $1.4 billion,  down 22% from Q1; biofuels dropped 12% to $750 million; small hydro slipped 30% to $1.1 billion.
  • Energy-smart technologies, such as smart grid and advanced transportation, showed an impressive 74% rise to $1.1 billion, but this was still down from last year.

Largest project investments:

  • $1.6 billion for the 270 MW Lincs offshore wind farm in the UK
  • $800 million for the 419 MW Flat Ridge wind farm in the US
  • $317 million for the second phase of the 250 MW Guodian Shanxi Qinyuan wind farm in China

Biggest venture capital deals:

  • Fisker Automotive (US): $148 million for plug-in hybrids
  • Sapphire Energy (US): $144 million for algae-based biofuels

The biggest IPO was a $340 million raise by Chinese solar water heater company Jiangsu Sunrain Solar Energy.

The new data jibes with stats that show solar surpassed wind as the top renewable energy investment in 2011. Solar attracted almost twice as much investment, jumping 52% to $147 billion. Booming rooftop installations in Italy and Germany were cited as a major factor.

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