A ‘mixed picture’ for clean energy investments favors wind over solar

A Bloomberg NEF assessment of clean energy investments in the first half of the year shows some good and bad, with spending on solar on the retreat but wind and new technologies receiving a boost.

Overall, global clean energy investments were down just 1 percent compared to the same period last year, according to BNEF. A 19 percent decrease in solar investments was offset by increases of 33 percent and 64 percent for wind and new technologies, including batteries and electric vehicles, respectively.

BNEF reported $71.6 billion of investment in solar, $57.2 billion in wind and $5.2 billion in new technologies in H1 2018. A “mixed picture” for the clean energy industry, the report said.

The main driver for a cooling solar industry is a Chinese government policy restricting new solar installations requiring a national subsidy, which has resulted in a 29 percent reduction in investments in that country, BNEF said. “We expect this to lead to a sharp drop in installations in China,” Justin Wu, head of Asia-Pacific at BNEF, said.

China’s investment in clean energy as a whole was down 15 percent compared to the same period last year. It was still the largest market for investments at $58.1 billion, more than double the US in second place at $28.8 billion.

Other countries that saw the largest decrease in investments from 2017 include Brazil, down 81 percent, Germany at 77 percent, Japan at 67 percent, and the UK at 51 percent.

But where investor interest in solar left off, wind and other new energy sectors picked up the pace.

Global investments in wind projects reached 57.2 percent, buoyed by large-scale on and offshore projects in the US, Europe and Asia. In the US, especially, wind investments are up $17.5 billion, 121 percent from the same period last year.

Emerging industries for new or “smart” energy technologies more than doubled to $5.2 billion, led by Chinese companies developing products like lithium-ion batteries and electric vehicles.

Despite somewhat anemic growth so far, BNEF reported figures for just the second quarter of 2018 that could be promising for the rest of the year. From April to June, there was an 8 percent rise in year-on-year clean energy investments to $76.7 percent.