2011 A Bumper Year For Solar Investment

Despite forecast doom on markets worldwide and an international trade dispute on the import of solar materials between the USA and China, total investment in clean energy soared to new heights in 2011, rising to $260 billion, according to latest figures from Bloomberg New Energy Finance (BNEF).

Last year also saw the one trillionth dollar invested in clean energy globally since the company started compiling data in 2004.

Solar power investments surged by 36 percent in 2011 to $136.6 billion, nearly doubling the $74.9 billion total investments in wind power – which fell 17 percent.

Though not the first time new cash for solar has outstripped wind (investments for solar exceeded wind in 2004 and 2010), it is the first time it has done so by such a large margin, and likely represents the rapid drop in the cost of photovoltaic materials.

Michael Liebreich, chief executive of BNEF says the performance of solar power on global markets is nothing short of remarkable, considering the price of solar panels fell by about 50 percent in 2011.

“The cost of PV technology has fallen, but the volume of PV sold has increased by a much greater factor as it approached competitiveness with other sources of power.”

2011 was also the year in which America once again overtook China as the world’s biggest spender on clean energy, after dropping to second-place in 2009. The U.S. invested a total $55.9 billion, up 33 percent; China saw investment rise just 1 percent to $47.4 billion.

However, Liebreich tendered a caveat to these numbers, pointing out they are thanks in large part to support initiatives such as the federal loan guarantee programme and a Treasury grant programme that have now expired. A rush by investors to get in on these schemes during the 3rd quarter of 2011 boosted the USA’s overall rating.

The largest single type of investment was the asset finance of utility-scale renewable energy projects. This increased from a revised $138.3 billion in 2010, to $145.6 billion in 2011.

Despite cutbacks to many EU feed-in tariff schemes for rooftop solar power systems, low panel prices made up for slackened return to homeowners with distributed renewable energy making up the second biggest investment category of 2011.

According to Liebreich, 2012 will be a challenging year, but rumours of the death of clean energy have been greatly exaggerated.

“Overall, 2011 was a far better year for the clean energy industry than the press coverage would lead one to believe. Remember that for every equipment company operating at thin or negative margins, there is an installer who is getting a good deal.”