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15 May 2017 2017 08:15 AM GMT

Overall Investment Down But Global Renewable Capacity Surges To Record Levels

As the cost of clean technology continues to fall, the world added record levels of renewable energy capacity in 2016, at an investment level 23 percent lower than the previous year, according to new research published by UN Environment, the Frankfurt School-UNEP Collaborating Centre, and Bloomberg New Energy Finance.

Global Trends in Renewable Energy Investment 2017 finds that wind, solar, biomass and waste-to-energy, geothermal, small hydro and marine sources added 138.5 gigawatts to global power capacity in 2016, up 8 percent from the 127.5 gigawatts added the year before. The added generating capacity roughly equals that of the world’s 16 largest existing power producing facilities combined. Investment in renewables capacity was roughly double that in fossil fuel generation; the corresponding new capacity from renewables was equivalent to 55 percent of all new power, the highest to date. The proportion of electricity coming from renewables excluding large hydro rose from 10.3 per cent to 11.3 per cent. This prevented the emission of an estimated 1.7 gigatonnes of carbon dioxide.

The total investment was $241.6 billion (excluding large hydro), the lowest since 2013. This was in large part a result of falling costs: the average dollar capital expenditure per megawatt for solar photovoltaics and wind dropped by over 10 per cent. “Ever-cheaper clean tech provides a real opportunity for investors to get more for less,” said Erik Solheim, Executive Director of UN Environment. “This is exactly the kind of situation, where the needs of profit and people meet, that will drive the shift to a better world for all.”

New investment in solar totalled $113.7 billion, down 34 percent from the record high in 2015. Solar capacity additions, however, rose to an all-time high of 75 gigawatts. Wind made up $112.5 billion of investment globally, down 9 percent; wind capacity additions fell to 54 gigawatts from the previous year’s high of 63 gigawatts. “The investor hunger for existing wind and solar farms is a strong signal for the world to move to renewables,” said Prof. Dr Udo Steffens, President of Frankfurt School of Finance & Management, commenting on record acquisition activity in the clean power sector, which rose 17 percent to $110.2 billion.

While much of the drop in financing was due to reduced technology costs, the report documented a slowdown in China, Japan, and some emerging markets, for a variety of reasons. Renewable energy investment in developing countries fell 30 percent to $117 billion, while that in developed economies dropped 14 percent to $125 billion. China saw investment drop 32 percent to $78.3 billion, breaking an 11-year rising trend. Mexico, Chile, Uruguay, South Africa and Morocco all saw falls of 60 per cent or more, due to slower than expected growth in electricity demand, and delays to auctions and financings. Jordan was one of the few new markets to buck the trend, investment there rising 148 percent to $1.2 billion.

The US saw commitments slip 10 percent to $46.4 billion, as developers took their time to build out projects to benefit from the five-year extension of the tax credit system. Japan slumped 56 percent to $14.4 billion. “The question always used to be ‘will renewables ever be grid competitive?’,” said Michael Liebreich, Chairman of the Advisory Board at BNEF. “Well, after the dramatic cost reductions of the past few years, unsubsidised wind and solar can provide the lowest cost new electrical power in an increasing number of countries, even in the developing world – sometimes by a factor of two.” “It’s a whole new world: even though investment is down, annual installations are still up; instead of having to subsidise renewables, now authorities may have to subsidise natural gas plants to help them provide grid reliability.”

Recent figures from the International Energy Agency cited the switch to renewables as one of the main reasons for greenhouse gas emissions staying flat in 2016, for the third year running, even though output in the global economy rose by 3.1 per cent. Investment in renewables did not drop across the board. Europe enjoyed a 3 per cent increase to $59.8 billion, led by the UK ($24 billion) and Germany ($13.2 billion). Offshore wind ($25.9 billion) dominated Europe’s investment, up 53 per cent thanks to mega-arrays such as the 1.2 gigawatt Hornsea project in the North Sea, estimated to cost $5.7 billion. China also invested $4.1 billion in offshore wind, its highest figure to date.

Another positive sign came in winning bids for solar and wind in auctions around the world, at tariffs that would have seemed inconceivably low a few years ago. The records set last year were $29.10 per megawatt hour for solar in Chile and $30 per megawatt hour for onshore wind in Morocco. Additional highlights included purchases of assets such as wind farms and solar parks reached a new high, $72.7 billion and corporate takeovers reached $27.6 billion, 58 per cent more than 2015. The smaller sectors had mixed fortunes in terms of new investment. Biofuels fell 37 percent to $2.2 billion, the lowest for at least 13 years; biomass and waste held steady at $6.8 billion and small hydro at $3.5 billion. Geothermal rallied 17 percent to $2.7 billion. Marine edged down 7 percent to $194 million.

Sitting two different technologies in the same location – to make use of shared land, grid connections, and maintenance, and to reduce intermittency – is growing. Some 5.6 gigawatts of these ‘hybrid’ projects have been built or are under development worldwide. The Ramanathapuram solar complex in India, billed as the world’s largest ever solar voltaic project (648 megawatts), was constructed. The report in full can be downloaded at fs-unep-centre.org.

July 28th 2017
Major Realignment In Motorsport As Porsche Prioritises Formula E Over Le Mans

Significant changes in motorsport are taking place as Porsche implements its strategy to develop a combination of pure GT vehicles and fully electric sports cars, such as the first fully battery-powered Mission E road car. “Entering Formula E and achieving success in this category are the logical outcomes of our Mission E”, says Michael Steiner, Executive Board Member, R&D at Porsche AG. “For us, Formula E is the ultimate competitive environment for driving forward the development of high-performance vehicles in areas such as environmental friendliness, efficiency and sustainability”.

August 14th 2017
Offshore Wind Drives 6.1 GW Of European Wind Installations In First Half Of 2017

6.1 GW of extra wind energy capacity was installed in Europe in the first half of 2017, according to figures released by WindEurope. The figure puts Europe on course for a bumper year for installations, although hides some worrying trends. WindEurope Chief Policy Officer, Pierre Tardieu, said: “We are on track for a good year in wind capacity installations but growth is driven by a handful of markets. At least ten EU countries have yet to install a single MW so far this year. Although this won’t translate into lower installations for another few years, the industry needs clarity on volumes for the post-2020 period to maintain the current cost reduction trend”.

August 9th 2017
IDFC Alternatives Fund Acquires Solar Projects Totaling 190MW From First Solar

India Infrastructure Fund II (IIF II), represented by its investment manager, IDFC Alternatives Limited, one of India’s largest alternatives fund managers, is to acquire seven operating solar projects owned and operated by the First Solar Group in the Indian states of Andhra Pradesh and Telangana aggregating to a capacity of 190 MW. All the projects utilise First Solar’s advanced CdTe (Cadmium Telluride) based thin film modules, one of the most environmentally friendly PV technologies, and sell the power generated to state utilities, under long term power purchase agreements. Aditya Aggarwal, Partner, IDFC Alternatives stated that “consistent with its stated strategy of aggregating operating renewable assets, IIF II is well on its way to achieving an installed base of 400-450 MW of operating renewable assets by the end of the current financial year.”

August 17th 2017
Siemens Gamesa Installs Asia’s Tallest Turbines, Whilst Stepping Up Integration

Siemens Gamesa has set a new record in Asia by installing this year the tallest wind turbines on the continent. The turbines are equipped with 153-metre tall towers, and with the 56-metre blades, they reach a total height of 210 metres. Presently, a major focus for the company is the integration of the entities of Siemens and Gamesa. This has the objective of realising the new company’s substantial potential, thanks to its bigger scale and global reach: a presence in more than 90 countries, an installed base of 75 GW, and an order book of €21bn.