Finance, Regulation, Solar, Sourcing Renewables, Wind - October 12, 2016
BNEF: Clean energy investment slipped again in Q3
Global clean energy investment had its weakest quarter since 2013 between July and September this year, under the impact of a summer lull in offshore wind financings in Europe and a further stage in the slowdown seen this year in project funding in China and Japan, Bloomberg New Energy Finance reported Oct. 10. Investment in renewable energy and
Investment in renewable energy and energy-smart technologies worldwide totaled $42.4 billion in the third quarter of 2016, down 31% from the second quarter and a striking 43% from the equivalent three-month period of 2015, according to newly released data from BNEF. Following lackluster numbers from both the first and second quarters of 2016, BNEF said it expects full-year totals to come in well below last year's record investment of $348.5 billion.
The third-quarter weakness was concentrated in particular areas: asset finance of utility-scale renewable energy projects was down 49% year-on-year at $28.8 billion, with wind down 32% and solar down 67%; investment in small-scale photovoltaic projects of less than 1 MW was 35% lower at $9.3 billion. In the geographical split, Chinese investment was down 51% compared with the prior-year quarter, at $14.4 billion, while Japan was down 56% at $3.5 billion.
Michael Liebreich, chairman of the advisory board at Bloomberg New Energy Finance, said in a statement that the numbers for the third quarter are "worryingly low" compared even to the subdued trend seen in the first two quarters of 2016. Liebreich added:
A vital point to bear in mind is that there have been sharp reductions in the cost of PV systems, so that much more solar capacity can be added this year than last, per million dollars. However it is also clear that, after last year’s record investment levels, some key markets such as China and Japan are pausing for a deep breath. Also, in many countries, electricity demand growth is undershooting government forecasts. My view is that the Q3 figures are somewhere between a ‘flash crash’ blip, and a ‘new normal’
Per usual, China was the largest investing country in clean energy in the third quarter, but, its total of $14.4 billion was no less than 51% than it was in the same quarter of 2015, reflecting a hiatus after last yea's rush to take advantage of incentives that were about to expire. The U.S. was the second biggest market with investment of $9.5 billion, down 40% from the year-ago quarter.
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