According to the Guardian, there is some hearty news in the world of renewable energy. A recent report states that investments in renewable energy reached $257bn (£165bn) last year. This was an increase of 17 percent from the previous year.
It appears that the world financial crisis has no bearing on renewable energy investments as “the record investment was a six-fold increase on the 2004 figure and nearly double the total in 2007, the year before the world financial crisis, according to a report from the United Nations Environment Programme (UNEP) and the Renewable Energy Policy Network for the 21st Century (REN21)”
The report entitled Global Trends in Renewable Energy Investment 2012, used data from Bloomberg New Energy Finance and duly noted that solar overtook wind energy as the hot investment prospect. Investment in solar panels spiked 52 percent mostly due to falling panel costs as well as policies that incentivize projects like rooftop and community solar. The report notes that although the total investment in renewable energy eclipsed the previous record set in 2010, the rate of investment is now stalling. The support for renewables is likely to wind down due to the number of global factors – the US is about to let important tax breaks expire, and the UK is reducing its solar support, but the biggest industry upset in Europe comes from Spain.
The report estimates that 16.7 percent of the world now runs on renewable energy with the biggest investments coming from China and the U.S. However, if we are to reduce the amount of coal being used, not only does renewable energy use have to increase, fossil fuels have to be actively phased out as well. This dual approach is ultimately what is going to speed the transition.
A representative for REN21 said: “We need to do more, if we are to combat climate change and use low-carbon technology. These figures are very good, but there is still a long way to go.”
The downside of all this, is that these massive investments in renewables could be the last-ditch attempt to make the best of all the incentives that are going to scrapped soon. However, the authors also noticed the increase in rooftop installations of solar panels indicating a shift towards more decentralization even in countries like Italy, Germany and the UK.