UN hails green energy gold rush

2008-07-02 14:26

Michael Szabo

London - In what is being called a "green gold rush," global investment in renewable energy surged some 60% to $148bn in 2007, a UN agency said on Tuesday.

Buoyed by soaring fossil-fuel prices and concerns over the carbon dioxide emissions that fuel global warming, investment in clean energy from sources like wind, solar and bio-fuels last year rose three times faster then predicted by the UN Environmental Programme (Unep).

"Just as thousands were drawn to California and the Klondike in the late 1800s, the green energy gold rush is attracting legions of modern day prospectors in all parts of the globe," said Achim Steiner, head of Unep.

Wind power attracted the most capital last year at $50.2bn, or a third of all clean energy investment, Unep's Global Trends in Sustainable Energy Investment 2008 report said.

In March 2008, global installed wind capacity exceeded 100 gigawatts, or enough to power around 75 million homes.

Solar energy soared

Investment in solar energy soared by 254% to $28.6bn last year, while the bio-fuel sector foundered with funds falling nearly one third to $2.1bn, the report said.

Overall, clean energy accounted for 23 percent of all new installed capacity in 2007.

Public investment in renewable energy via the markets more than doubled to $23.4bn, up from $10.6bn in 2006, the report said.

The S&P Custom/ABN Amro Renewable Energy Index <.AAE> gained 70% in 2007, but has since fallen 14% on weakness in the global economy.

Most new money flowed into renewable energy leaders the European Union and the US, though China, India and Brazil attracted a sizable $26bn last year, up 14 times from $1.8bn in 2004.

The three developing countries now account for 22% of all new renewables investment, Uneo said.

Investment in Africa's clean energy sector grew fivefold to $1.3bnn in 2007, reversing a gradual decline that started in 2004.

"Sub-Saharan Africa, arguably the region that has the most to gain from renewable energy, remains largely unexploited," the report said.

Developing nations

The renewable energy sector is expected to grow to $450bn in 2012, and up to $600bn by 2020, Unep said.

Developing nations like China, which recently surpassed the US as the world's top emitter, are being encouraged by rich countries to embrace renewable energy and adopt binding emissions targets under a new international climate pact.

The Kyoto Protocol's first commitment period expires in 2012, and governments are now racing to negotiate a new agreement that they hope to have in place by the UN's climate talks next year.

"The (report's) findings should empower governments - both North and South - to reach a deep and meaningful new agreement by the crucial climate convention meeting in Copenhagen in late 2009," Steiner said.

In the US, as public acceptance shifts to cleaner energy, the government is being called on to lead a "carbon revolution" by passing domestic climate legislation and agreeing to at least halve emissions by 2050.

US climate bill

Both candidates in the US presidential election in November have said they support deep cuts and experts are confident either one will make progress on a US climate bill in the first six months of their presidency.

"A new administration in 2009 is expected to make renewable energy a priority while recent uncertainly (over possible emissions regulations) has put a number of coal-fired generation plants on hold," the report said.

On Monday, a Georgia state court invalidated a permit to build a 1 200-megawatt coal power plant, citing the developers' failure to limit emissions of carbon dioxide.

- Reuters