Bloomberg says international clean energy investment running behind 2015

Bloomberg New Energy Finance (BNEF) said July 14 that international ‘clean energy’ investment in the second quarter totaled $61.5bn, some 12% above the first-quarter 2016 figure but 32% below a very strong outturn of $90bn in the equivalent period of 2015.

Looking at the 2016 trend so far, and taking the Q1 and Q2 2016 figures together, global investment in the first half of this year was $116.4bn, some 23% lower than in the opening six months of 2015, according to the latest data from Bloomberg New Energy Finance.

Europe’s figure for H1 2016 was up 4% at $33.5bn, and Brazil was up 36% at $3.7bn. But all the other regions were down – China by 34% to $33.7bn, India down 1% at $3.8bn, the rest of Asia Pacific down 47% at $12.1bn, Middle East and Africa down 46% at $4.2bn, the US down 5% at $23.1bn, and the Americas excluding the US and Brazil down 63% at $2.3bn.

Michael Liebreich, chairman of the advisory board at Bloomberg New Energy Finance, said: “It is now looking almost certain that the global investment total for this year will fail to match 2015’s runaway record. China’s financing of wind and solar projects was even higher last year than previously estimated, and the hangover this year caused by weak electricity demand and policy changes in that country will therefore be all the greater.”

Changes in the solar market are another of the main reasons for the lower trajectory for global investment so far this year. Photovoltaic panels and project construction have become cheaper in many countries, and there has also been a shift from small-scale projects (relatively expensive in terms of dollars per MW) to utility-scale projects, which are cheaper in capex terms.

While the figures for 2016 so far have been on the low side, BNEF also revealed today that global clean energy investment was even stronger last year than thought. Revised figures show that new investment in 2015 was $348.5bn, nearly $20bn above the previous estimate of $328.9bn published in January.

The revision reflects information on investment transactions not disclosed at the time. The two big changes to the 2015 total are an upward revision of $29bn to asset finance of utility-scale wind and solar projects – mainly in China and the United States – and a downward revision of $10bn to spending on small distributed capacity, such as rooftop solar, particularly in Japan.

Abraham Louw, associate for energy economics at Bloomberg New Energy Finance, said: “One shouldn’t look at these latest Q2 figures too negatively. Last year’s investment of $348.5bn was really quite groundbreaking – up 11% over 2014 and 30% over 2013.”

 

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.