Clean Energy Records Lowest Quarter of Investment Since 2009

by | Apr 13, 2012

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After clocking up a record in 2011, new financial investment in clean energy in Q1 2012 was the weakest since the depths of the financial crisis in Q1 2009, according to analysis by Bloomberg New Energy Finance.

New financial investment was down 28 percent from Q4 2011 to just $27bn; it was 22 percent lower than the equivalent figure in the first quarter of last year.

The Q1 2012 new financial investment total included $24.2bn in asset finance for utility-scale renewable energy projects, such as wind farms and solar parks, plus $1.9bn of venture capital and private equity investment in specialist clean energy companies. Just $601m was raised on the public markets by quoted companies during the period, Bloomberg says. The $27bn total excludes small-scale projects and corporate and government RD&D, on which Bloomberg New Energy Finance reports only annually.

The analysis firm says the weak performance reflects the destabilizing uncertainty over future clean energy support in both the European Union – driven by the financial crisis – and the US, driven by the expiry of stimulus programs and by the electoral cycle.

The news comes on the same day that the American Wind Energy Association called 2011 a year for double-digit growth and claimed that wind power will see a strong 2012.

The U.S. wind industry installed 6,816 MW in 2011, 31 percent higher than 2010, for a total of 46,916 MW installed in the U.S. to date. And there is more than 8,300 MW under construction, “setting the stage for a strong 2012,” the trade body said.

The AWEA acknowledged that recent activity was driven by the federal Production Tax Credit – a soon-to-expire government-backed tax incentive that it says leverages up to $20 billion a year in private investment. If the PTC expires this year, as it is due to, it will halt progress in the American wind power industry, AWEA says.

In January, Vestas, the world’s largest maker of wind turbines in terms of revenue, warned that 1,600 U.S. jobs were at risk if clean energy tax credits, including the PTC, are not extended past the end of this year.

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