Renewable energy and efficiency have moved into the mainstream, with investors worldwide pouring $100 billion into the sector in 2006, up 25% from 2005, according to a United Nations Environment Program report. About 20% was invested in the developing world.
The total is likely to leap to $120 billion in 2007.
$71 billion of the $100 billion came from IPOs and spending on research and development; mergers and acquisitions added almost US$30 billion.
Renewable energy stocks have far outpaced the world stock market benchmarks this year.
Through the public markets, investment more than doubled in 2006 to reach $10.3 billion, but the greatest growth has been in private equity investments, which hit $7.1 billion in 2006, more than twice as much as the previous year.
Almost 10% of investments were in China. Investments in India were slightly lower, while Latin America received 5%.
The wind sector received 38% of investments, followed by biofuels with 26% and solar with 16%.
18% of the world’s investment in energy generation now goes to renewables, which still only constitute 2% of the energy supplies.
“One of the new and fundamental messages of this report is that renewable energies are no longer subject to the vagaries of rising and falling oil prices,” UNEP Executive Director Achim Steiner said. “They are becoming generating systems of choice for increasing numbers of power companies, communities and countries irrespective of the costs of fossil fuels.”
The report also said forecasts by the International Energy Agency are very conservative – renewables could account for up to 23% of world energy supplies by 2030, way up from IEA’s 9% projection.
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