Solar investment slid on the back of cheaper modules and China setback

While the amount of money invested in clean energy worldwide topped $300 billion for the fifth year running last year, tumbling solar module costs and China’s decision to put the brakes on PV subsidies saw the amount ploughed into solar tumble 24% on 2017’s figure.

The world invested $130.8 billion in PV in 2018, according to figures compiled by BloombergNEF, although that dramatically reduced number is still higher than the amount invested in chief green energy rival wind ($128.6 billion) as well as smaller technologies biomass ($6.3 billion), geothermal ($1.8 billion) and marine ($180 million). Small hydro was the only other clean energy segment to suffer a fall in investment, as funding fell by half to $1.7 billion.

BlombergNEF cited a 12% fall in the cost of installing a megawatt of PV capacity as an example of falling solar prices driven by a global supply glut after Beijing’s 5/31 New Policy announcement. That policy about turn dragged Chinese solar investment down a thumping 53% last year, to $40.4 billion.

Chinese EV industry attracts investors

The flipside is that the analysts said the capacity of global solar installations rose from 99 GW in 2017 to 109 GW last year, as markets outside China took advantage of falling prices. The Spanish PV market secured a sevenfold rise in renewable energy investment and, together with wind, helped Europe’s overall clean energy figure rise 27% to $74.5 billion, behind only China and the U.S.

The largest clean energy investments seen last year included an estimated $2.4 billion for Morocco’s NOORm Midelt PV and solar thermal project and $500 million for India’s NLC Tangedco PV scheme.

The figures also illustrate how much funding is being pumped into Chinese electric vehicle (EV) companies, with manufacturer NIO completing a $1.2 billion IPO and domestic peer and EV battery maker Contemporary Amperex Technology securing an $852 million listing. French solar developer Neoen also had a successful IPO, raising $808 million.

Eight venture capital and private equity capital injections raised a further total of $3.3 billion for Chinese EV companies, including a $795 million boost for Youxia Motors, although it was U.S. smart window maker View that topped the pile in that segment, with backing of $1.1 billion.