As the cost of installing solar panels waned and China pressed pause on its spending, global investment in renewable energy sunk 23 percent in the first half of 2016.
According to London-based Bloomberg New Energy Finance, solar, wind, and other clean-energy industries engrossed $116.4 billion in the first two-quarters of the year 2016. This included $61.5 in the second quarter. The research company said it also reviewed up 2015’s total by practically $20 billion to a record of $348.5 billion.
Founder of Bloomberg New Energy Finance, Michael Liebreich remarked, “It is now looking almost certain that the global investment total for this year will fail to match 2015’s runaway record.”
The capital spending needs of developers have been reduced thanks to inexpensive photovoltaic panels and lower financing costs even as installations of the equipment have reached their personal best.
Bloomberg New Energy Finance also reported a shift in the direction of more utility-scale projects and further away from smaller-scale installations, the reason for the review of the 2015 data.
2015’s swell in investment occurred as nearly 200 countries made the landmark decision in Paris to reduce fossil-fuel emissions thought to be the blame for global warming.
Brazil and Europe were the only areas to see a rise in investment during the first of 2016, with Europe’s 4 percent gain (caused by some major offshore wind projects) approaching financial close.
In comparison, China’s investments fell 34 percent down to $33.7 billion. This is partly because solar and wind investments were higher than originally expected. Liebreich said that lower power demand and government policy modifications could also be blamed for holding back investments.
In Africa and the Middle East, investment fell 46 percent to $4.2 billion. The United States saw a drop of 5 percent to $23.1 billion.
Article written by HEI contributor Briana Steptoe.