The Americas stand out in solid Q3 for clean energy investment
Worldwide investment in renewable energy and energy-smart technologies totalled $70 billion in the third quarter of 2015, just 1 percent below the equivalent figure a year earlier, according to the latest authoritative data from Bloomberg New Energy Finance.
The largest projects to be financed in Q3 this year included solar thermal electricity generation, or CSP, plants in China, Israel and South Africa, and four offshore wind farms in Chinese waters "“ the first real wave of sea-based wind projects to get the go-ahead outside that technology's original market, Europe.
However, the countries enjoying the biggest-percentage gains in investment in the third quarter of 2015 compared to Q3 2014 were mostly in the Americas. Brazil saw investment jump 131 percent on a year earlier to $2.3 billion, thanks to a rush of wind project financings, while Chile leapt from $180m in Q3 2014 to $1.6 billion in the latest quarter, and the US enjoyed a 25 percent surge in investment to $13.4 billion.
Michael Liebreich, chairman of the advisory board at Bloomberg New Energy Finance, commented: "Investment in the first three quarters of this year has been $197.9 billion, just $4.3 billion down on the same period of 2014 "“ a resilient performance given the sizeable shifts in foreign exchange rates that will have reduced the dollar value of projects outside the US.
"Part of the explanation is the ongoing improvement in cost-effectiveness of solar and wind relative to fossil fuel generation. That is enabling those renewable energy technologies to attract a big share of power sector investment everywhere from China and Japan to Latin America and South Africa."
The detail of Bloomberg New Energy Finance's data shows that asset finance of utility-scale renewable energy projects totalled $47.3 billion in the third quarter, down 4 percent on the same quarter of 2014, but spending on small-scale projects, such as rooftop solar, increased 21 percent to $19 billion.
Among the big utility-scale projects funded were the Qinghai solar thermal plant in China, at $866m for 200MW, the Longyuan Haian Jiangjiasha offshore wind farm, also in China, at $856 million for 300 MW, and the SolarReserve Redstone solar thermal complex in South Africa, at $749 million for 100 MW.
Investment in specialist clean energy companies by venture capital and private equity funds shot up 92 percent in Q3 this year to $2 billion, helped by a $500m VC round for Chinese electric vehicle company NextEV and a $150m financing for View, the California-based electronically tinting window technology developer.
Public markets, meanwhile, invested $3.7 billion in clean energy companies in Q3, down 38 percent compared to the same quarter in 2014. The biggest equity-raisings were a $750m issue by Tesla Motors, the electric car maker, and a $675 million initial public offering by TerraForm Global, a US-based "yieldco" owning renewable energy assets in emerging markets.
Breaking the figures down by region, China was once again the largest centre for investment, at $26.7 billion in Q3, some 5 percent up on the same period a year earlier. The US was second, at $13.4 billion, boosted by financial close for a succession of solar and wind projects worth several hundred million dollars each.
Asia-Pacific outside India and China was the third biggest region, at $11.4 billion, down 1 percent on Q3 2014. However, Europe saw investment of just $5.8 billion in the latest three months, down 48 percent from the third quarter of last year and its weakest performance since Q4 2004.
Angus McCrone, senior analyst at Bloomberg New Energy Finance, said: "The drop in European investment reflects in part a lull in offshore wind financings in Q3, after no fewer than three deals worth more than $2 billion off the coasts of the UK and Germany in the second quarter. But it is also the case that support policies have become less friendly to wind and solar investors in several countries, including Italy, Germany, Denmark and, most recently, the UK."
Looking at the global numbers by sector, investment in solar slipped 1 percent to $43.9 billion in Q3 2015 compared to a year earlier, while that in wind fell 5 percent to $20.5 billion. Among the smaller sectors, biomass and waste-to-energy attracted $1.3 billion in Q3, down 26 percent, while small hydro-electric projects of less than 50 MW harnessed $1.5 billion, up 41 percent, and geothermal $530 million, down 16 percent.
