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Investment in New Energy and Energy Efficiency in 2009, at $162 billion, was 7% below the previous year. Considering the extent of the worldwide recession, that is a remarkably small decrease. Investment in biofuels and solar power plants was off more significantly. Investment in wind energy, however, set new records.
There is little doubt about the most striking 2009 New Energy (NE) and Energy Efficiency (EE) statistic: Investment in China grew 53%. The world invested $119 billion in NE/EE in 2009 and China got $33.7 billion of it.
For the first time, investment in Asia/Oceania’s NE/EE ($40.8 billion) was greater than that in the Americas. Investment in Europe’s NE/EE was down 10% ($43.7 billion).
On the strength of total investment in China greater than investment in the U.S., China’s installed NE capacity increased 37 gigawatts (GW) in 2009.
The more important numbers are found in the amount of recovery money that was dedicated internationally to NE/EE investment ($188 billion) versus how much has been spent (9%). That leaves 91% of $188 billion to be invested in 2010 and 2011. With $170+ billion in stimulus funding ready to go to work in NE and EE over the next 18 months, there is likely to be a lot of action.
Total NE/EE investment (excluding large hydro) in 2009 (~$100 billion) was about the same as investment in fossil-fuel generation. Adding investment in large hydro ($39 billion) makes total investment in NE more than fossil-fuel generation investment for the second year in a row.
Most notable singular areas of 2009 investment: (1) China wind development, (2) North Sea offshore wind investment, and (3) financing for electricity storage and electric vehicle technology.
Energy-smart technologies (power storage, EE hardware and software, etc.) accounted for $2.3 billion in public markets investment and $2.1 billion in VC and PE investment in 2009. It was the first time the efficiency technologies got more VC/PE investment than NE.
New Energy and Energy Efficiency sector share prices were up ~40% over 2008, when they fell ~33%. In Q1 2010, they under-performed the stock markets as a whole by ~10% but were up 50+% over Q1 2009.
The recovery has hesitated in 2010’s Q2, with markets volatile in response to international economic turmoil and government economic policies compromised by political pressure to cut deficit spending. But the impact of the remaining 91% of that $188 billion NE/EE stimulus money should be interesting to see.