Investments in clean energy down in third quarter, may hit 8-year low

Global investment in clean energy totaled $56.6 billion in the third quarter of 2012, down 5 percent from the previous quarter and 20 percent lower than 3Q 2011, according to Bloomberg New Energy Finance. The decreases are partially explained by weaker figures from the U.S. and India and a stall in wind farm financings.

The current numbers estimate that the full-year investment in renewables in 2012 may fall short of 2011’s record of $280 billion, which would make 2012 the first down-year for world investments in the sector in eight years.

Michael Liebreich, chief executive of Bloomberg New Energy Finance, said: “The fact that 2012 looks like being a down-year is disappointing, but not surprising – indeed we predicted as much in January. The decline should not be exaggerated either. The third quarter figure was still well over $50 billion – roughly equivalent to investment in the whole of 2004.”

Solar topped the sector with $33.8 billion in investments in the third quarter, slightly up from last quarter but down 22 percent from last year. Wind is second with $15.5 billion, down 26 percent from 2Q and 23 percent on the year; small hydro has $3.5 billion, biomass and waste follow with $2 billion, energy-smart technologies at $800 million and biofuels brought in $700 million in investments.

A geographical split shows investment in the US in 3Q at $7.3 billion, down 28 percent on 2Q, and 62 percent on 3Q 2011. China saw investment slip 17 percent on the quarter to $14.8 billion, although this was up 6 percent on the same time frame last year. India’s investment fell 16 percent on the quarter to $1.5 billion and was 60 percent down from the same quarter in 2011, while Brazil showed a 94 percent increase on the quarter to $1.9 billion, some 24 percent up on the year. Investment in Europe was $18.2 billion, down 2 percent on 2Q 2012 and 29 percent on 3Q 2011.

Asset finance of utility-scale projects such as wind farms, solar parks and biofuel plants fell 10 percent to $32.2 billion in 3Q 2012. Asset finance in 3Q 2011 was $49.5 billion thanks to the closing of the U.S. federal loan guarantee program.

Investments in small-scale projects, such as rooftop solar, are estimated to be $21.3 billlion in 3Q, up 11 percent on the same quarter last year.

The $497 million, 258 MW Verace wind portfolio in Brazil was one of five projects that had their financing approved between July and September.

Venture capital and private equity investors put $1.3 billion into clean energy firms in the third quarter, down 20 percent from 2Q and 34 percent than 3Q 2011. Some of the large deals include a $200 million funding round to SolarCity and a $104 million round for U.S.-based biofuel developer Elevance Renewable Sciences.

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