Renewable investment strong, despite small contraction
Global investment in renewable energy has blasted through records, hitting USD $288 billion in 2018, far exceeding the amount spent on fossil fuel investments.
Outlined in BloombergNEF’s Renewables 2019 Global Status Report, numbers show that while investment was 11 per cent down over the previous year, 2018 was the ninth successive year in which it exceeded USD 200 billion and the fifth successive year above USD 250 billion.
The report finds that the dip in investment is a response to falling technology costs in the solar photovoltaic industry, meaning that more capacity is produced at ever decreasing costs, while at the same time the year saw a slowdown in solar power deployment in China.
However, globally, the solar industry continued to be the single largest focus of investment in the renewable sector, with USD $139 billion invested in 2018. Wind power investment increased two per cent in 2018, to USD 134.1 billion. The other sectors lagged far behind, although investment in biomass and waste-to-energy increased 54 per cent, to USD 8.7 billion.
The figures compare the amount invested in new renewable power capacity, which was USD 272.3 billion globally in 2018 (excluding large hydro), with that in new coal- and gas-fired generating capacity, which was USD 95 billion.
“Global trends continue to indicate that investing in renewable energy is investing in a profitable future. Investments in renewable energy in 2018 were three times higher than the amount invested in new coal and gas-fired generators,” said Inger Andersen, Executive Director of the UN Environment Programme. “
China accounted for 32 per cent of the global total investment, followed by Europe at 21 per cent, the United States at 17 per cent, and Asia-Oceania (excluding China and India) at 15 per cent. Smaller shares were seen in India at 5 per cent, the Middle East and Africa at 5 per cent, the Americas (excluding Brazil and the United States) at 3 per cent and Brazil at 1 per cent.
The report’s authors were quick to argue that the declining amount invested in 2018 is not a sign of flagging efforts to decarbonise, but rather a symptom of decreasing costs of greenfield renewable generation.
“When overall investment falls, it is easy to think we are moving backwards, but that is not the case,” Angus McCrone, Chief Editor at BloombergNEF, commented: “Renewable energy is getting less expensive and we are seeing a broadening of investment activity in wind and solar to more countries in Asia, Eastern Europe, and the Middle East and Africa.”
The full report can be found here