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DAILY ! ENVIRONMENT REPORT Reproduced with permission from Daily Environment Report, DEN 6-4-09, 06/04/2009. Copyright 姝 2009 by The Bureau of National Affairs, Inc. (800-372-1033) http://www.bna.com
Energy
Investment in Sustainable Energy Rose 5 Percent in 2008, U.N. Report Says nvestment in sustainable energy ‘‘has defied the global economic recession,’’ growing about 5 percent in 2008, the United Nations Environment Program said in a report issued June 3. New investment is shifting from the industrialized West toward China, India, and the developing world, UNEP said in the report, Global Trends in Sustainable Energy Investment 2009. Nonetheless, the economic crisis ‘‘has taken its toll on investments in clean energy when set against the record-breaking growth of recent years,’’ the report said. The sector grew at an annual rate of about 50 percent from 2003 through 2007, according to the report, which was released by the UNEP’s Sustainable Energy Finance Initiative.
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$500 Billion Investment Needed. Investment in the sustainable energy sector was valued at around $155 billion in 2008, up from the $148 billion in 2007, UNEP reported. The report examined investment trends in biofuels, biomass, geothermal, ‘‘mini-hydro,’’ solar, wind, and even some carbon-capture and tidal power projects. It did not include nuclear power or ‘‘large hydro.’’ ‘‘While the $155 billion sustainable investment in 2008, plus multi-billion dollar stimulus packages can go a long way, investment needs to reach a half trillion dollars per annum by 2020 to help ensure a peak in greenhouse gas emissions by then,’’ the report concluded. Nations including China, Japan, the Republic of Korea, and the United States have earmarked multi-billion dollar investments in clean energy, including smart grids, ‘‘under the banner of a global ‘green deal,’ ’’ the report said.
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It also said the election of President Obama ‘‘heralded a change in U.S. policy on climate change and sustainable energy’’ that brought about ‘‘a timely boost’’ to the sustainable energy sector just at it was starting to fall dramatically.
Political Will ‘Never Greater.’ The $180 billion in major government fiscal stimulus packages worldwide ‘‘suggests that the political will to secure sustainable energy supplies and reduce energy-related carbon emissions has never been greater,’’ the report said. Direct lending to finance sustainable energy assets grew by almost 13 percent in 2008, to about $117 billion, according to the report. The bulk of that was for new power generation; new-build wind project investment rose from $41.3 billion in 2007 to $47.9 billion in 2008, but collapsed in the first quarter of 2009, the report said. New-build solar project financing ‘‘underwent a dramatic increase’’ in 2008, growing from a little over $12 billion in 2007 to just over $22 billion, but it also fell sharply in the first quarter of 2009, the report said. Carbon Market Grew 87 Percent. Another key finding of the report is the growth in carbon credit trading. Despite the turmoil in the world’s financial markets, the report said, ‘‘the global carbon market grew 87 percent during 2008, reaching a value of $120 billion.’’ The most liquid markets are the European Union’s Emission Trading Scheme (EU-ETS), and the global Kyoto Protocol compliance market, which covers some 45 percent of Europe’s total greenhouse gas emissions and dominates the carbon credit trading market, accounting for 79 percent of transactions by value. The report predicted that the cost of solar and wind projects will fall as supply chain bottlenecks ease, and ‘‘several players may consolidate.’’ The price of solar photovoltaic modules, for example, is predicted to fall by over 43 percent in 2009, the report said. Solar continues to be the fastest growing sector for new investment, with 49 percent growth in 2008 over 2007, reflecting the easing of the silicon bottleneck. ISSN 1060-2976
2 Wind attracted the highest new investment, confirming its status as the most mature and best-established sustainable generation technology, the report said. Its growth is strongest in China and the United States, it said. ‘‘China became the world’s second largest wind market in terms of new capacity and the world’s biggest photovoltaic manufacturer,’’ the report said.
Full text of the UNEP report, Global Trends in Sustainable Energy Investment 2009, is available at http:// sefi.unep.org/english/globaltrends2009.html.
BY JANICE VALVERDE
6-4-09
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ISSN 1060-2976