Intelligent Energy

Solar leads global surge in renewables investments

Solar leads global surge in renewables investments

Posting in Energy

Solar thermal power plants like BrightSource's Mojave Desert project spark investors' interest in renewables. Stock market gains are another matter.

A solar boom led investments in clean energy to the third highest quarter on record, to $41.7 billion for the 3 months ended June 30, according to London-based Bloomberg New Energy Finance.

Investments climbed 22% above the same quarter a year earlier, and were 27% higher than 2011’s first quarter.

Funding of solar thermal power plants contributed to much of the gain, the research company said.

It singled out the $2.2 billion BrightSource Energy raised for its 392-megawatt project in California’s Mojave Desert. Projects run by Juno Beach, Fla.-based NextEra Energy Resources, and by S. Africa’s Eskom Holdings Ltd. also received significant investments.

While clean energy investments surged, market gains fell. The WilderHill New Energy Global Innovation Index dropped by 13% in the same period, Bloomberg noted.

“The explanation is partly to do with ongoing investor worries, perhaps overdone, about future policy support, and partly to do with the fact that this is a highly competitive sector, in which costs are falling and high manufacturer margins are hard to sustain,” Bloomberg New Energy Financial Michael Liebreich said. As reported here, solar panel prices are free-falling.

The report marked the second indication this week of a jump in renewables’ investments.

Earlier this week, the UN, in collaboration with Bloomberg, reported that 2010 global renewable energy investing rose by 32% to $211 billion, led by China’s wind push.

China also led in the second quarter, despite a quarterly decline.

“While China remained the biggest investor in clean energy projects, its funding fell 11 percent to $12 billion from the first three months of the year,” Bloomberg noted. “In the U.S., investment almost tripled to $10.5 billion, the third-highest figure ever.”

Bloomberg also said that private equity and venture capital investment rose 74 percent to $3.1 billion in the quarter, the highest for any quarter since 2008. Equity capital investments through initial public offerings and other measures fell 7 percent to $3.4 billion from the first quarter, it said.

The numbers did not include mergers, acquisitions and refinancing. Those funds rose 93 percent to $21.7 billion, including French oil company Total’s $1.38 billion 60% acquisition of San Jose, Calif.-based solar panel maker SunPower Corp.

Photo: BrightSource

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Mark Halper

Contributing Editor

Mark Halper has written for TIME, Fortune, Financial Times, the UK's Independent on Sunday, Forbes, New York Times, Wired, Variety and The Guardian. He is based in Bristol, U.K. Follow him on Twitter. Disclosure