Global investments in renewable energy rebounded strongly last year, registering a solid 17% increase to $270 Billion in 2014 after two years of declines and brushing aside the challenge from sharply lower crude oil prices.
That's according to UNEP’s 9th annual Global Trends in Renewable Energy Investment 2015, prepared by the Frankfurt School – UNEP collaborating Centre for Climate and Sustainable Energy Finance (the Centre) and Bloomberg New Energy Finance (BNEF) the main cause were major expansions of solar installations in China and Japan and record investments in offshore wind projects.
A continuing sharp decline in technology costs – particularly in solar but also in wind – means that every dollar invested in renewable energy bought significantly more generating capacity in 2014. The 103GW of capacity added by new renewable energy sources last year compares to 86GW in 2013, 89GW in 2012 and 81GW in 2011 and made 2014 the best year ever for newly installed capacity.
Wind, solar, biomass and waste-to-power, geothermal, small hydro and marine power contributed to an estimated 9.1% of world electricity generation in 2014, up from 8.5% in 2013. This meant that last year the world electricity system emitted 1.3 gigatonnes of CO2 – roughly twice the emissions of the world’s airline industry – less than it would have if that 9.1% had been produced by the same fossil-dominated mix generating the other 90.9% of world power.
"Once again in 2014, renewables made up nearly half of the net power capacity added worldwide" said Achim Steiner, UN Under-Secretary-General and Executive Director of UNEP. "These climate-friendly energy technologies are now an indispensable component of the global energy mix and their importance will only
increase as markets mature, technology prices continue to fall and the need to rein in carbon emissions becomes ever more urgent."
Geographic breakdown
China saw by far the biggest renewable energy investments last year — a record $83.3 billion, up 39% from 2013. The US was second at $38.3 billion, up 7% on the year though this is below its all-time high reached in 2011. Third came Japan, at $35.7 billion, 10% higher than in 2013 and its biggest total ever.
As in previous years, the market in 2014 was dominated by record investments in solar and wind, which accounted for 92% of overall investment in renewable power and fuels. Investment in solar jumped 25% to $149.6 billion, the second highest figure ever, while wind investment increased by 11% to a record $99.5 billion. In 2014, some 49GW of wind capacity and 46GW of solar PV were added worldwide, both records.
The dominant feature of the solar sector was an unprecedented expansion in China and Asia, which collectively invested $74.9 billion in solar in 2014 -- around half the world’s total. A boom in European offshore wind development resulted in seven $1 billion-plus projects reaching "final investment decision" stage in 2014. Among these the $3.8 billion 600MW Gemini installation off the cost of the Netherlands was the largest non-hydro renewable energy plant to get the go-ahead anywhere in the world. Other renewable energy sources did not perform so well by comparison. Biofuels fell 8% to $5.1 billion, biomass and waste-to-energy dropped 10% to $8.4 billion and small hydro was down 17% to $4.5 billion. Only geothermal bucked the trend with a 23% increase to $2.7 billion.
A stand-out feature of the 2014 result was the rapid expansion of renewables into new markets in developing countries, where investments jumped 36% to $131.3 billion. China with $83.3 billion, Brazil ($7.6 billion), India ($7.4 billion) and South Africa ($5.5 billion) were all in the top 10 investing countries, while more than $1 billion was invested in Indonesia, Chile, Mexico, Kenya and Turkey.
The full 9th annual Global Trends in Renewable Energy Investment 2015 report is available for download online.