Clean-Energy Investment in Asia Exceeds Americas for First Year

09/01/2010 at 7:27 pm Leave a comment

Clean-energy investment in Asia rose during the global recession in 2009, surpassing the Americas for the first time as China installed wind turbines and solar panels to replace coal-burning power plants.

Energy systems using the sun, wind and biofuels in the Asia-Pacific region attracted $37.3 billion, up 25 percent from 2008, data from Bloomberg New Energy Finance show. Spending fell by the same rate in North and South America to $32 billion.

“China’s big appetite for green energy to swiftly reduce its heavy dependence on coal was a major driving force,” said Hidetoshi Shioda, a senior energy analyst at Mizuho Securities Co. in Tokyo. “Looking ahead, China’s appetite for alternative- energy investment will probably remain strong this year.”

Hampered by the worst economic slump since the Great Depression, European and U.S. investment fell as banks held back financing for the biggest projects. That direction needs to be reversed to lower oil use and limit greenhouse-gas discharges, according to the International Energy Agency, the energy-policy adviser to developed nations including the U.S. and Britain.

The Paris-based IEA forecast in November an average $1.1 trillion in spending, or 1.4 percent of global economic output, is needed annually through 2030 to meet projected energy demand. On top that, $430 billion must be spent on infrastructure, power plants and biofuels to limit greenhouse gases, the IEA said.

Economic growth and less exposure to subprime-related financial products compared with Europe and the U.S. helped several Asian nations increase investment, Shioda said. Overall global clean-energy investment dropped 6.5 percent to $145 billion from a record $155 billion in 2008, the data show.

Stimulus Spending

China’s $586 billion stimulus program and record bank lending boosted industrial output and energy demand. China may report 8.5 percent economic growth for 2009, a senior official said this week.

Chinese asset-finance investment in wind turbines rose 27 percent to $21.8 billion and in solar almost doubled to $1.9 billion, according to Bloomberg New Energy Finance. The biggest producer of greenhouse gases from burning fossil fuels hosted the largest renewable-energy initial public offering last year as China Longyuan Power Group Corp. raised more than $2 billion.

The most populous nation has enough wind-energy potential to generate seven times its current power consumption, according to a study by Michael McElroy, a researcher at Harvard University, published in the journal Science in September. Though much of that will be difficult to harness, developing all the capacity to meet rising demand would cost about $900 billion, he wrote at the time.

“The Chinese government is genuinely concerned about air pollution in its cities,” said Barbara Hon, energy analyst at Everbright Securities Co. in Hong Kong, who expects a 20 percent increase in China’s wind-generating capacity this year.

The third-largest economy was also the third-biggest producer of electricity from wind in 2009. The country’s windpower capacity was about 20,000 megawatts in 2009 compared with 764 megawatts in 2004, said Shi Lishan, deputy director of new energy at the National Energy Administration.

To contact the reporter on this story: Jeremy van Loon in Berlin atjvanloon@bloomberg.net.

Source: http://www.bloomberg.com/apps/news?pid=20601080&sid=aJPwOCrxA0FE

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