Report: Renewables keep growing but are held back by uncertain policies

Intro

The global renewable energy industry keeps growing, but could be growing more if governments would enact more stable renewable policies according the latest Renewables Global Status Report from REN21. The report reveals that 2012 was the second highest year ever for renewable energy investments, which total $1.3 trillion since 2006. The report also reveals a continuing upward trend for the renewable industry in developing countries. In 2012, renewable investments in the South topped $112 billion compared to $132 billion in developed countries. This is a dramatic change from 2007, when developed economies invested 2.5 times more in renewables (excluding large hydro) than developing countries, a gap that has closed to just 18%.

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Key Points

  • Around the world the renewable energy sector continues to produce millions of jobs. In 2012, an estimated 5.7 million people worldwide worked directly or indirectly in the renewable energy sector. Brazil, China, India, members of the EU, and USA continue to see huge numbers of renewable jobs, but employment is growing in other countries, and there are increasing technicians and sales staff job numbers in off-grid sectors of the developing world. In Bangladesh for example, selling, installing, and maintaining small solar panels employs 150,000 people directly and indirectly.

  • As nations work to limit greenhouse gas emissions, the continued growth of the renewable sector shows that the solutions are already here. During the June international climate talks in Bonn, Germany, the Alliance of Small Island States (AOSIS) called for separate discussions to help fast-track efforts to scale up renewables. This followed the formation of the Renewables Club, 10 pioneering countries that aim to accelerate the rollout of renewable technologies

  • With stable policy in developed nations, the renewable industry can keep growing, keep producing jobs and remain a critical solution to the current climate crisis. Uncertainties with American renewable policies contributed to a 34% decrease in renewable investment. Similar uncertainties in Italy and Spain resulted in a dent to the sector, but in Japan, new feed-in tariff subsidies for installations contributed to a 73% spike in renewable investment. This shows that with the right policies in place around the world, solutions to climate change can also help solve the global recession.

Background

First released in 2005, REN21’s Renewables Global Status Report (GSR) has grown to become a truly collaborative effort of over 500 authors, contributors and reviewers, and is today the most frequently referenced report on renewable energy market, industry and policy trends. It provides testimony to the undeterred growth of electricity, heat, and fuel production capacities from renewable energy sources, including solar PV, wind power, solar hot water/heating, biofuels, hydropower, and geothermal.

This latest Renewables Global Status Report provides a comprehensive and timely overview of renewable energy market, industry, investment and policy development worldwide. 2012 saw: a shift in investment patterns that led to a global decrease in clean energy investment, continuing growth in installed capacity due to significant technology cost reductions and increased investment in developing countries, and a trend of renewables progressively supplementing established electricity systems. The latest REN21 study also shows an emergence of integrated policy approaches that link energy efficiency measures with the implementation of renewable energy technologies.

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Useful facts from this report

  • Morocco saw the go-ahead for a $1.2 billion investment to finance the Masen Ouarzazate solar thermal project.
  • In the Indian state of Gujarat a 605 MW PV solar park was completed in April 2012 that is expected to save around 8 million tonnes of CO2 and 900,000 tonnes of natural gas per year.
  • Close to $1 billion was announced for a 396MW wind project in Oaxaca State, Mexico.
  • After the shift away from a nuclear power-dependent energy policy in the wake of the Fukushima nuclear accident, TEPCO commissioned its first three solar plants in 2011 and 2012 at Kawasaki and Mt. Komekura for a total of 30MW.
  • Warren Buffett’s MidAmerican Holdings launched an $850 million bond issue in February 2012 to finance its 550MW Topaz Solar Farm in California, only to see it oversubscribed by more than $400 million.
  • $5 billion of ‘green’ bonds were issued in 2012, a 44 per cent increase over 2011.
  • The phenomenon of crowd sourcing—in which capital is raised from large numbers of small investors—took off in small-scale solar in Europe and the United States.

Quotes

  • “Driven in part by the UNFCCC process and various provisions and mechanisms of the Kyoto Protocol, the increasing deployment of wind, solar, geothermal and other clean energy power sources serve as a powerful antidote to those who claim that a transition to a low-carbon, resource-efficient future is unobtainable.” Christiana Figueres, Executive Secretary, United Nations Framework Convention on Climate Change

  • “To meet the common goal to limit global warming to two degrees Celsius from pre-industrial levels public and private partners need to increase their mutual understanding and cooperate in their efforts to advance options for new climate finance investments.” Prof. Dr. Steffens, President and CEO of the Frankfurt School of Finance & Management, host of the Frankfurt School – UNEP Collaborating Centre for Climate & Sustainable Energy Finance

  • “It is encouraging that renewable energy investment has exceeded $200 billion for the third successive year, that emerging economies are playing a larger and larger part, and that the cost-competitiveness of solar and wind power is improving all the time. What remains daunting is that the world has hardly scratched the surface – CO2 emissions are still on a firm upward trend and there was still nearly $150 billion of net investment in new fossil-fuel generating assets in 2012.” Michael Liebreich, Chief Executive, Bloomberg New Energy Finance

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