Sparks

A new record in renewable investment

 By Benjamin Plackett

A new report published by “Clean Energy Canada” says $367 billion was spent on renewables across the globe last year, which equates to a 7 percent rise compared with 2014. Benjamin Plackett explains why low oil prices don’t make investment in clean energy shy and what it means for the future…

(Cover photo by www.businesstimes.com)

The figures are in. Last year broke all records for investments in renewable energy.

A total of $367 billion was spent on renewables across the globe — that’s a rise of 7 percent compared to the year before. All of this came despite a large scale and sustained fall in oil prices.

These are just some of the findings in a new report released by the Clean Canada organization, which seeks to promote a transition to clean and renewable energy systems. But that’s not how most analysts thought it would pan out back in the beginning of 2015. They assumed cheaper oil prices would make renewable energies less competitive.

“But when you step back and look objectively,” says Dan Woynillowicz, who was involved with the report, “there are relatively few places where oil is being used for electricity and so there aren’t that many markets where there’s a head-to-head competition.”

The cause of this surge in investment is manyfold and varies country to country. “In China, air pollution in their cities is a huge driver,” says Woynillowicz. “Whereas for developed economies like Europe and North America, it’s a key opportunity to reduce greenhouse gas emissions from our electricity and meet targets.”

Source: IRENA

In other regions of the world, namely Africa and parts of India, they’re building their electricity infrastructure for the first time. “They have the chance to get it right the first time,” says Woynillowicz.

But more than that, renewables also represent a chance for these countries to be energy independent. “Renewables are homegrown energy that they can control and don’t need to import,” explains Woynillowicz. “It means they won’t be beholden to the volatility of the commodities markets.”

Most of the investment came from China, where over $110 billion was spent on renewable technology last year, followed by the U.S., Japan, U.K. and India — with the British and Indian markets seeing the most growth.

Solar and wind energy were by far the most attractive opportunities for investors, contributing to a combined spend of $271 billion. “It’s a tight competition between solar and wind, but we’ve seen solar dominate by a small margin over the last couple of years,” says Woynillowicz. “Solar has an advantage that it can be deployed everywhere on rooftops whereas wind needs more space.”

It’s hard for Woynillowicz to make a prediction as to whether 2016 will see a continued growth of investment because the figures for the first quarter aren’t available yet. Investment in the beginning of the year is typically less impressive anyway.

But he says that the analysts who track the market have a positive outlook, suggesting that this year may also prove fruitful for renewable energy.

 

SEE MORE: Iran gauges appetite for renewables by Criselda Diala-McBride

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about the author
Benjamin Plackett
I’m a journalist based in London. I report on all things science, tech, and health for a number of different publications. My work has been published by The Daily Dot, Inside Science and CNN among others. I earned my M.A. in Journalism at New York University and my B.Sci in Biology from Imperial College, London.