Global trends in sustainable energy investment 2009

Jun 2009

The drivers that have propelled investment in the sustainable energy sector so dramatically for the past five years are still at work – climate change, energy insecurity, fossil fuel depletion, new technologies etc. There is also a strong core of demand for clean energy based on firm mandates: feed-in tariffs, renewable portfolio standards, renewable fuel standards, building codes, and efficiency regulations. In many markets clean energy also provides strong economic returns, particularly green jobs, even in a period of lower energy prices.
A more rapid transition to – and accelerated pace of investment in – sustainable energy is required so that CO2 peaks by 2020. Annual investments in renewable energy, energy efficiency and carbon capture and storage need to reach $500 billion by 2020, rising to $590 billion by 2030, representing an average investment of 0.44% of GDP between 2006 and 2030. These levels of investment are not impossible to achieve, especially in view of the recent four year growth from $35 billion to $155 billion.
However, reaching them will require a further scale-up of societal commitments to a more sustainable, low-carbon energy paradigm.
With the current stimulus packages now in play and a hoped-for Copenhagen climate deal in December, the opportunity to meet this challenge is greater than ever, even seen from the depths of an economic downturn.
This report presents the financial perspective on the current state of play in the development of sustainable energy. The analysis consists of actual data on the different types of capital flows and their movement over time, combined with analysis of regional and sectorial trends.
The information is intended to serve as a strategic tool to be used by decision makers in the policy and finance communities globally as they weigh-up commitments to the sustainable energy sector.

By: UNEP (DTIE), SEFI, New energy finance

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