The latest Clean Energy Trends 2014, issued today, found that the world installed 36.5 gigawatts of new solar energy last year, which was more than the 35.5 gigawatts of wind energy for the first time. Record levels of new solar deployment in China, Japan, and the U.S. combined with a down year in the wind industry to create this crossover. The report was produced by the clean-tech research and advisory firm Clean Edge, Inc.
The global clean-energy picture for 2013 was a classic good news-bad news story. The global solar market saw double-digit growth (15 percent). The growth in solar and a modest uptick in biofuels’ market size, however, were not enough to overcome the wind industry’s lackluster performance. As a result, combined global revenue for solar PV, wind power, and biofuels held nearly steady at $247.6 billion, down just slightly from $248.7 billion in 2012.
Despite dazzling growth and rising stock prices in some sectors, especially solar photovoltaic (PV) deployment, downward trends, policy issues and finance hurdles are affecting the industry as a whole.
“The adoption of clean energy is set against a bigger-picture context that finds many of the world’s largest energy-using nations struggling with critical choices for their energy future,” said Ron Pernick, Clean Edge co-founder and managing director. “Climate disruptions, smog alerts, planned and unplanned nuclear power shutdowns, and resource scarcity are all driving significant change, accelerating the double-digit adoption growth of solar PV, hybrid and electric vehicles, green buildings, and other clean-tech solutions.”
Clean Edge projects that solar, wind, and biofuels will expand from $247.6 billion in 2013 to $397.8 billion within a decade
Solar photovoltaics grew to $91.3 billion from $79.7 billion in 2012, with a record 36.5 GW installed globally. This includes modules, system components, and installation. PV panel costs were steady last year, dropping to $2.50 per watt installed. That stands in contrast to 2011 and 2012 when PV panel costs plummeted more than 20 percent each year.
Even though the wind industry added 35.5 GW of new capacity in 2013, it was well below the previous year’s record 44.7 GW. It was the weakest performance for wind energy since 2008. New installation of wind power fell to $58.5 billion from $73.8 billion in 2012 in contrast with the growth of $11.6 billion in solar.
The report also found that biofuels (global production and wholesale pricing of ethanol and biodiesel) rose slightly, from $95.2 billion in 2012 to $97.8 billion last year. Global biofuels production remained constant at 31.4 billion gallons, with average prices increasing slightly.
.On the downside, venture capital investments in U.S.-based clean-tech companies fell 25 percent in 2013 dropping to $4.4 billion from the $5.8 billion invested in 2012, according to data provided by Cleantech Group. Some of the VC financing slack was made up by the continued rise of large corporate and project finance deals. Google invested $3.2 billion to acquire the smart thermostat maker Nest in early 2014. Goldman Sachs’ invested $500 million to finance SolarCity’s PV installations. Wells Fargo has pledged to invest $100 million in tax equity financing in SunEdison projects.
Since 2012, Congress has worked hard to discourage development of clean energy. It has cut incentive programs for clean energy established under the bush administration and the first two years of the Obama administration. It extended the wind tax credit, but only for a year. Congress, particularly the Republican-controlled House, has made a statement that it prefers investment in fossil fuels and pipelines over clean energy. This has created uncertainty that has chilled investment.
Clean Edge, Inc. was founded in 2000 as the world’s first research and advisory firm devoted to the clean-tech sector. The firm delivers a suite of clean-energy benchmarking services including stock indexes, utility and consumer surveys, and regional leadership tracking. SolarCity was one of the sponsors of the Clean Energy Trends Report.
Given the rapidly rising costs of catastrophic weather events due to climate change, perhaps governments, including our own, will realize that investment in all sectors of clean energy is no longer an option.