Investment in renewables sets global record

BEIJING, China, November 16, 2005 (Refocus Weekly)

The global investment in renewable energies reached a record of US$30 billion last year, accounting for one-quarter of all the world’s investment in the power industry.

Wind, solar, biomass, geothermal and small hydro provide for 160 GW of capacity, which is 4% of the world total, says ‘Renewables 2005: Global Status Report’ prepared by the Worldwatch Institute. The fastest-growing green power technology is grid-connected solar PV, which increased 60% in capacity each year from 2000 to 2004.

The capacity of wind power grew by 28% in 2004, led by Germany with 17,000 MW installed by the end of the year, while production of biofuels surpassed 33 billion litre and ethanol displaced 3% of the 1,200 billion litre of gasoline consumed each year.

“Renewable energy has become big business,” explains author Eric Martinot. Solar panels cover 400,000 rooftops in Japan, Germany and the United States, and 40 million homes heat their water with solar collectors, most of which have been installed in the last five years. Two million earth energy heat pumps have been installed in 30 countries to heat and cool buildings, although the third Green Heat technology, biomass, provides five times more heat worldwide than earth energy and solar combined.

Development assistance to developing countries for renewable energy projects, training and market support has reached $500 million a year, with the majority of funds provided by the German Development Finance Group (KfW), World Bank Group and Global Environment Facility (GEF), with dozens of other donors and programs providing the balance. In developed nations, 4.5 million consumers in Europe, the U.S., Canada, Australia and Japan purchased green power at the retail level or from certificates last year.

Martinot worked with 100 researchers and contributors from 20 countries to compile the global status report, which provides an assessment of small hydro, modern biomass, wind, solar, geothermal and biofuels which now compete with conventional fuels in four markets: power generation, hot water and space heating, transportation fuels, and rural (off-grid) energy.

Government support for renewables is growing, with at least 48 countries now providing some type of promotion policy for renewables, as well as 14 developing countries. Most targets for green power range from 5% to 30% by 2012, while mandates for green fuels have been enacted in 20 jurisdictions around the world, as well as in Brazil, China and India.

Some of the world’s largest companies are being attracted to renewables, including General Electric, Siemens, Sharp and Royal Dutch Shell, and the report estimates that renewable energy industries provide 1.7 million jobs, most of which are skilled and well-paying.

The report addresses the lack of energy reporting in emerging renewable energy technologies, and regular updates are planned. It does not provide analysis, recommendations or conclusions.

Of the 160 GW of global green power (excluding large hydropower), 44% is in developing countries, and large hydro provided 16% of the world’s electricity. Renewables generated as much electricity last year as one-fifth of the world’s nuclear reactors.

Government support for renewables was $10 billion in 2004 for the U.S. and Europe combined, including direct support and support from market-based policy mechanisms. This includes $700 million per year in research.

“Solar and wind power costs are now half what they were 10 to 15 years ago,” and the report says “many renewable technologies can compete with retail and even wholesale prices of conventional energy under good conditions, even as conventional technology costs also decline.” Market facilitation organizations are supporting the growth of renewable energy markets, investments, industries and policies through some combination of networking, information exchange, market research, training, partnering, project facilitation, consulting, financing, policy advice, and other technical assistance.”

The report was produced by the Worldwatch Institute and released at the Beijing International Renewable Energy Conference 2005, which involves many of the stakeholders that met at the International Conference for Renewable Energies in Germany.


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