Home Page |
Home Page for Mobile
africafocus by e-mail - analysis that goes beyond the news
africafocus.org - your first stop for Africa policy issues on the web
http://www.africafocus.org/docs11/ren1107.php
AfricaFocus Bulletin
"Global investment in renewable energy jumped 32% in 2010,
to a record $211 billion. It was boosted in particular by
wind farm development in China and small-scale solar PV
installation on rooftops in Europe. ... Significant
investment is also starting to be seen in Africa, which
posted the highest percentage increase of all developing
regions, if the emerging economies of Brazil, China and
India are excluded. ... Total investment on the continent
rose from $750 million [in 2009] to $3.6 billion [in
2010]." -- Global Trends in Renewable Energy Investment
2011
As noted in another AfricaFocus Bulletin released today and
available on the web at "There was a sense, in both the second half of 2010 and
early 2011, that progress in renewable energy was taking
place at a pace that public opinion and policymakers in
many countries were simply failing to spot. This progress
was both in investment levels and, even more, in costcompetitiveness
with conventional power sources."
Another sign of increased momentum on the renewable energy
front was the launch of the International Renewable Energy
Agency (IRENA), with headquarters in Abu Dhabi. An initial
consultation earlier this month resulted in the "Abu Dhabi
Communiqué on Renewable Energy for Accelerating Africa's
Development," also included in this AfricaFocus Bulletin.
While the language of the declaration echoes all too
familiar conference boilerplate commitments, it indicates a
growing consensus that renewable energy must take higher
priority in Africa's development plans. As prices drop, and
renewable energy becomes more competitive, private
investors as well as policy makers are taking the sector
more seriously.
For previous AfricaFocus Bulletins on environment and
climate issues, see http://www.africafocus.org/envexp.php
++++++++++++++++++++++end editor's note+++++++++++++++++
United Nations Environment Programme and Bloomberg New
Energy Finance, 2011
http://www.unep.org / http://www.newenergyfinance.com
Global investment in renewable energy jumped 32% in 2010,
to a record $211 billion. It was boosted in particular by
wind farm development in China and small-scale solar PV
installation on rooftops in Europe.
Of the major types of investment, there were sharp
increases in asset finance of utility-scale projects such
as wind farms, in venture capital provision for young
firms, and in equity-raising on the public markets by
quoted renewable energy companies. Asset finance rose 19%
to $128 billion in 2010, venture capital investment
increased 59% to $2.4 billion, and public market investment
gained 23% to $15.4 billion.
However the sharpest percentage gains were in investment in
small-scale projects, up 91% year-on-year at $60 billion,
and in government-funded research and development, up 121%
at $5.3 billion, as more of the "green stimulus" funds
promised after the financial crisis arrived in the sector.
One of the striking features of 2010 was that, in terms of
financial new investment (asset finance and investment by
venture capital, private equity and public markets,
developing countries overtook developed economies for the
first time.
Achim Steiner, UN Under-Secretary General and UNEP
Executive Director
Investments in renewable energies, from wind and solar
power to geothermal and waste-into-energy, continued their
remarkable growth in 2010.
A combination of stimulus package funds making their way
into the market, the introduction of smart policies like
feed-in tariffs and target-setting sparked a record $211
billion of investment in renewable energy.
The more-than-$48 billion new investment in China merits
attention in terms of scale and growth. Other highlights of
this year's report are rising investments across other
parts of the developing world, and the sharp increase in
investment in small-scale renewables in countries such as
Germany and Italy, where predominantly rooftop solar
projects surged to $60 billion-worth of investment, up over
90% from 2009.
Excluding Brazil, Mexico took the lead in Latin America
where investments, mainly in wind but also in geothermal,
grew close to 350%, triggered in large part by a government
decision to raise renewable energy capacity from 3.3% to
over 7.5% by 2012.
Argentina, with a target of 8% of its energy to be sourced
from renewables by 2016, saw investment grow nearly sevenfold
to $740 million. 2010 also saw important investment in
Chile, Peru and Venezuela.
In Asia, Pakistan and Thailand saw investments tripling and
quadrupling respectively. In Pakistan $1.5 billion worth of
wind was financed and in Thailand $700 million-worth of
investment flowed, mainly into large-scale photovoltaic
projects.
Significant investment is also starting to be seen in
Africa, which posted the highest percentage increase of all
developing regions, if the emerging economies of Brazil,
China and India are excluded.
In Egypt, renewable energy investment rose by $800 million
to $1.3 billion as a result of the solar thermal project in
Kom Ombo and a 220MW onshore wind farm in the Gulf of Zeit.
In Kenya, investment climbed from virtually zero in 2009 to
$1.3 billion in 2010 across technologies such as wind,
geothermal, small-scale hydro and biofuels. Small but
significant advances were also made in Cape Verde, Morocco
and Zambia.
Renewable energies are expanding both in terms of
investment, projects and geographical spread. In doing so,
they are making an increasing contribution to combating
climate change, countering energy poverty and energy
insecurity, stimulating green jobs and meeting the
Millennium Development Goals.
The UN climate convention in Durban later in the year,
followed by the Rio+20 Conference in Brazil in 2012, offer
important opportunities to accelerate and scale-up this
positive transition to a low carbon, resource efficient
Green Economy in the context of sustainable development and
poverty eradication.
Global investment in renewable power and fuels set a new
record in 2010, and the margin over totals for previous
years was wide, not narrow. Investment hit $211 billion
last year, up 32% from a revised $160 billion in 2009, and
nearly five and a half times the figure achieved as
recently as 2004.
The record itself was not the only eye-catching aspect of
2010. Another was the strongest evidence yet of the shift
in activity in renewable energy towards developing
economies. Financial new investment, a measure that covers
transactions by third-party investors, was $143 billion in
2010, but while just over $70 billion of that took place in
developed countries, more than $72 billion occurred in
developing countries.
This is the first time the developing world has overtaken
the richer countries in terms of financial new investment -
the comparison was nearly four-to-one in favour of the
developed countries back in 2004. It is important to note
that in two other areas not included in the financial new
investment measure, namely small-scale projects and
research and development, developed economies remain well
ahead.
However the balance of power in renewables has been
shifting towards developing countries for several years.
The biggest reason for this has been China's drive to
invest: last year, China was responsible for $48.9 billion
of financial new investment, up 28% on 2009, with the asset
finance of large wind farms the dominant part of that. But
the developing world's advance in renewables is no longer a
story of China and little else. In 2010, financial new
investment in renewable energy grew by 104% to $5 billion
in the Middle East and Africa region, and by 39% to $13.1
billion in South and Central America.
The developing world - at least outside its most powerful
economies - may not be able to afford the same level of
subsidy support for clean energy technologies as Europe or
North America. However it has a pressing need for new power
capacity and, in many places, superior natural resources,
in the shape of high capacity factors for wind power and
strong solar insolation. It, also, is starting to host the
development of a range of new renewable energy technologies
for specific, local applications. As Chapter 10 recounts,
these range from rice-husk power generation to solar
telecommunications towers and are becoming the technology
of choice, not a poor substitute for diesel or other
fossil-fuel power options.
A second remarkable detail about 2010 is that it was the
first year that overall investment in solar came close to
catching up that in wind. For the whole of the last decade,
as renewable energy investment gathered pace, wind was the
most mature technology and enjoyed an apparently
unassailable lead over its rival power sources. In 2010,
wind continued to dominate in terms of financial new
investment, with $94.7 billion compared to $26.1 billion
for solar and $11 billion for the third-placed biomass &
waste-to-energy. However these numbers do not include
small-scale projects and in that realm, solar, particularly
via rooftop photovoltaics in Europe, was completely
dominant. Small-scale distributed capacity investment
ballooned to $60 billion in 2010, up from $31 billion,
fuelled by feed-in tariff subsidies in Germany and other
European countries. This figure, combined with solar's lead
in government and corporate research and development, was
almost enough to offset wind's big lead in financial new
investment last year.
No energy technology has gained more from falling costs
than solar over the last three years. The price of PV
modules per MW has fallen by 60% since the summer of 2008,
according to Bloomberg New Energy Finance estimates,
putting solar power for the first time on a competitive
footing with the retail price of electricity in a number of
sunny countries. Wind turbine prices have fallen 18% per MW
in the last two years, reflecting, as with solar, fierce
competition in the supply chain. Further improvements in
the levelised cost of energy for solar, wind and other
technologies lie ahead, posing a bigger and bigger threat
to the dominance of fossil-fuel generation sources in the
next few years.
Total investment in renewable energy in 2010 was $211
billion, up from $160 billion in 2009 and $159 billion in
2008. Within the overall figure, financial new investment -
which consists of money invested in renewable energy
companies and utility-scale generation and biofuel projects
- rose to $143 billion, from $122 billion in 2009 and the
previous record of $132 billion in 2008.
A sharper increase however has been evident in the other
components of the total investment figure - namely smallscale
distributed capacity, and government and corporate
R&D. These jumped to $68 billion in 2010, from $37 billion
in 2009 and $26 billion in 2008, reflecting mainly the boom
in rooftop PV, but also a rise in government-funded R&D, as
spending increased from "green stimulus" announced after
the financial crisis.
...
A third challenge for renewables came from outside
scepticism. This manifested itself both in the stock market
- where clean energy shares under-performed wider indices
by more than 20% on pessimism about future profit growth and
in international politics, where the mood postCopenhagen
and post-Climategate was cooler than in some
previous years. In fact, more progress towards emission
reduction was achieved than expected at the December 2010
meeting in Cancun; and the consensus among climate
scientists about man-made global warming actually
strengthened during last year. However neither has - yet catapulted
clean energy back to the top of government
agendas.
There was a sense, in both the second half of 2010 and
early 2011, that progress in renewable energy was taking
place at a pace that public opinion and policymakers in
many countries were simply failing to spot. This progress
was both in investment levels and, even more, in costcompetitiveness
with conventional power sources.
Africa achieved the largest percentage increase in
renewable energy investment among developing regions
excluding the big three economies [China, India, Brazil].
Total investment on the continent rose from $750 million to
$3.6 billion, largely as a result of strong performances
from Egypt and Kenya.
In Egypt, renewable energy investment rose by $800 million
to just over $1.3 billion, but this was the result of just
two deals, a 100MW solar thermal project in Kom Ombo, and a
220MW onshore wind farm in the Gulf of El Zeit region. The
country's next move in renewable energy is scheduled to be
the tender for several hundred MW more of wind projects in
the Gulf of Suez region.
In Kenya, the advance was more broadly based. Investment
rose from virtually zero to more than $1.3 billion,
including funding for wind, geothermal and small hydro
capacity of 724MW, and for 22 million litres per year of
ethanol production. Geothermal was the highlight, with
local electricity company KenGen securing debt finance for
additional units at its Olkaria project.
Smaller advances in renewable energy were made by several
other African countries, including Zambia, Morocco and Cape
Verde. In Morocco, there could be a step-jump in renewable
power investment with a 150MW wind farm near the northern
city of Taza and a 500MW solar thermal project at
Quarzazate in the country's south. Both of these have
reached the tendering or pre-selection stage. South Africa
is likely to be one of the most important locations in the
continent for renewable energy over coming years, with
December 2010 seeing the government in Pretoria receiving
384 applications from companies seeking to build up to 20GW
of renewable power capacity. Local utility Eskom was in
line by the spring of 2011 for a $365 million loan from the
African Development Bank to help pay for a 100MW solar
thermal plant in the Northern Cape and a 100MW wind farm in
the Western Cape.
10 Jul 2011
IRENA-Africa High-Level Consultations on Partnership on
Accelerating Renewable Energy Uptake for Africa's
Sustainable Development, 08-09 July 2011
International Renewable Energy Agency (IRENA)
http://www.irena.org / Direct URL:
http://tinyurl.com/62pq79u
We, Ministers of Energy and heads of delegations of African
countries and the African Union Commission and the
Conference of Energy Ministers of Africa (CEMA), met at the
invitation of IRENA in Abu Dhabi, UAE, 08-09 July 2011,
hosted by the UAE Government. Participants included
regional economic communities, national bodies,
international partners, UN-Economic Commission for Africa,
EU-Africa Energy partnership, World Bank, UNIDO, UNEP, UNHabitat,
Global Environment Facility, Paris-Nairobi Climate
Initiative, key energy companies, NGOs research agencies
and others.
Our discussions were guided by the February 2009 African
Union Assembly of Heads of State and Government decision
to: "develop renewable energy resources in order to provide
clean, reliable, affordable and environmentally friendly
energy," We were also informed by the Special Report on Renewable
Energy Sources and Climate Change Mitigation of the
Intergovernmental Panel on Climate Change, as well as
IRENA's report, Scenarios and Strategies for Africa, which
provide compelling evidence of the serious energy
challenges faced by the region.
At a time of economic growth and opportunity in Africa,
meeting energy needs and addressing the challenge of energy
access and energy security is an issue of primary
significance for Africa, in order to mitigate the negative
effects of price volatility, supply insecurity and
environmental degradation.
We also recognize the significant potential of renewable
energy to accelerate African low carbon development and
address climate change mitigation and adaptation. Achieving
these outcomes will require:
The African continent sees great promise in working with
IRENA, whose Assembly has given it a strong mandate
regionally and globally to support member states in
accelerating the adoption of renewable energy.
Considering the above, we have agreed the following:
AfricaFocus Bulletin can be reached at africafocus@igc.org.
Please write to this address to subscribe or unsubscribe to
the bulletin, or to suggest material for inclusion. For
more information about reposted material, please contact
directly the original source mentioned. For a full archive
and other resources, see http://www.africafocus.org
|