By - Jim Vess

Global clean energy investments fall in 2018 as solar takes a big hit

Energize Weekly, January 23, 2019

Global clean energy investments were down slightly in 2018 to $332 million, but it still marked the fifth year in a row with more than $300 billion in expenditures, according to Bloomberg New Energy Finance (BNEF).

Investments were off 8 percent when compared to 2017, led by a fall in solar financing, which was down 24 percent to $130.8 billion, the BNEF analysis said.

Wind investments were up 3 percent for the year to $128.6 billion, spurred by offshore projects, which had their second-best year on record.

Offshore wind received $25.7 billion in 2018, a 14 percent year-over-year increase, with large projects such as the $3.3 billion, 950-megawatt (MW) Moray Firth East array in the North Sea.

Thirteen Chinese offshore wind farms began construction, for a total of some $11.4 billion.

“The balance of activity in offshore is tilting,” David Hostert, head of wind analysis at BNEF, said in a statement. “Countries such as the U.K. and Germany pioneered this industry and will remain important, but China is taking over as the biggest market and new locations such as Taiwan and the U.S. East Coast are seeing strong interest from developers.”

Onshore wind projects received $100.8 billon, a 2 percent increase over 2017. Among the biggest projects were the 760-MW Enel Green Power South Africa complex worth $1.4 billion and Xcel Energy’s $1 billion, 600-MW Xcel Rush Creek wind farm in Colorado.

The sharp drop in solar photovoltaic (PV) investment was due to a number of factors, BNEF said.

“Part of this reduction was due to sharply declining capital costs,” Bloomberg said. “BNEF’s global benchmark for the cost of installing a megawatt of photovoltaic capacity fell 12 percent in 2018 as manufacturers slashed selling prices in the face of a glut of PV modules on the world market.”

A switch in Chinese solar policy also had an impact as the government sought to tamp down the country’s solar boom by restricting access to its feed-in tariff for new projects.

Still, BNEF estimated that total global PV installations in 2018 were up 10 percent over 2017 to 109 gigawatts.

Among the largest solar projects were the 800-MW NOOR Midelt PV, a solar facility in Morocco, estimated at $2.4 billion. India’s 709-MW NLC TANGEDCO PV plant, a $500 million project, was another of the biggest.

Investment in biomass and waste-to-energy was up 18 percent to $6.3 billion, biofuels were up 47 percent to $3 billion, and geothermal also rose 10 percent to $1.8 billion.

Money for smart meter rollouts and electric vehicle (EV) company financings also increased.

Among countries, China remains the investment leader at $100.1 billion, despite a 32 percent decline over 2017—largely due to the change in solar policy.

“Once again, the actions of China are playing a major role in the dynamics of the energy transition, helping to drive down solar costs, grow the offshore wind and EV markets and lift venture capital and private equity investment,” Jon Moore, chief executive of BNEF, said in a statement.

The U.S. was in second place with $64.2 billion in investments, a 12 percent annual increase, as wind and solar developers press to take advantage of projects tax credits before they expire in the next few years.

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