Global Clean Energy InvestmentData from the first quarter of 2010 show a solid growth in global clean energy investment. While China maintained its global lead with clean energy investments of $6.5bn, the wind energy sector saw a global investment of $14.1bn, making it the biggest renewable energy sector. In spite of some lingering concerns, a record overall new investment in clean energy worldwide is forecast for the year 2010.

by Naimish Upadhyay, Green Economy Post

According to latest data from Bloomberg New Energy Finance, new financial investment in clean energy worldwide totalled $27.3bn in the first quarter of 2010, up sharply from $20.8bn in the same period of last year but down from $31.6bn in the fourth quarter of 2009. Clean energy investments in China and the finance of wind farms continue to be the two strongest features of investment in Q1.

These quarterly figures cover financial investment – asset finance of wind farms, solar parks, biofuel plants and other projects; and public market, venture capital and private equity finance for clean energy companies. The data was compiled from Bloomberg New Energy Finance’s proprietary Industry Intelligence database of global investment activity and projects.

The new data underlines the message of a study that Bloomberg New Energy Finance produced in conjunction with Pew Charitable Trusts in March, which showed the extent to which China has overtaken the US to become the global leader in attracting clean energy investment.

Investment in clean energy assets in China in the first quarter was $6.5bn, the largest for any country, while investment in wind farms worldwide was $14.1bn, easily the biggest for any renewable energy sector. Both were down from peak levels in the third quarter of 2009, but they were 24% and 43% respectively above the equivalent figures for Q1 2009.

The latest quarterly figures show that there was an uptick in asset finance in the US. It rose to $3.5bn in Q1, from $2.4bn in Q4, and recorded its strongest quarter since Q2 2009, helped by a $394m construction debt package for the Alta Wind Energy Center in Tehachapi, California.

Europe, by contrast showed a slowdown for projects such as wind farms and solar parks, down to $4bn in the first quarter, from $6bn in Q4 and $7.6bn in Q1 2009. This reflects the fact that although a stream of small European wind and solar projects clinched debt and equity finance
between January and March this year, few larger ones did.

One of the most striking figures was the Q1 2010 total for venture capital and private equity – at $2.9bn, an improvement on $1.7bn in Q4 last year and $1.6bn in the first quarter of 2009. Among the bigger deals was a $350m Series B round for US electric vehicle infrastructure firm Better Place and a $219m expansion capital round for Brazilian wind firm Energimp. Like asset finance, venture capital and private equity investment dropped from a peak before the financial crisis to a low point in early 2009. It is now rebounding as the prospects of IPOs and trade sales of portfolio companies improves.

Public market investment came in at $2bn in the first quarter of this year, up from the dismal $0.3bn recorded in Q1 2009, immediately after the worst phase of the financial crisis. However the latest quarter was well down on Q4’s $5.8bn, and one of the few significant transactions was a $202m issue of shares by US-based but UK-listed Clipper Windpower to UTC Corporation.

Corporate merger and acquisition activity between January and March 2010 was $5.2bn, almost reaching the $5.6bn in Q4 and nearly three times the $1.9bn figure realised in Q1 2009. Consolidation is continuing to take place in several clean energy sectors, and the largest acquisition of the quarter was Bunge’s purchase of the Moema ethanol business in Brazil for
$896m.

According to Michael Liebreich, chief executive of Bloomberg New Energy Finance, Q1 2010 showed solid progress in global clean energy investment inspite of  the cold snap in the Northern Hemisphere, traditional sluggish start to the year for stock market equity raising and the time it is still taking to put together ‘clubs’ of banks for debt finance.

Liebreich predicts a record overall new investment in clean energy in 2010 – between $175bn and $200bn, compared to last year’s $162bn. There is also a strong potential for significant IPO activity in the next quarter.

Photo Courtesy of John Nyberg

© 2010, Naimish Upadhyay. All rights reserved. Do not republish.

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Author: Naimish Upadhyay (9 Articles)

Naimish Upadhyay recently graduated with an MS degree in Environmental Science & Policy from the University of South Florida, where he focused on sustainability policies of Florida businesses and local governments. While in graduate school, he was an active member of the Emerging Green Builder’s USF chapter (http://ctr.usf.edu/egb/) as well as the Student Taskforce on Campus Sustainability at his university. Naimish previously taught college level Environmental Science and Environmental Biotechnology in India. Given his research and project experience, Naimish is eager to build a professional career in the areas of business sustainability, environmental management systems, sustainability assessment and reporting, and corporate social responsibility. Naimish looks forward to reader feedback and can be reached via email naimishupadhyay@gmail.com.

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