Cheaper solar power takes less investment

Solar energy investment is set to fall in 2018 due to cutbacks in China and lower equipment costs, according to research from Bloomberg NEF.

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Solar energy investment is set to fall in 2018 due to cutbacks in China and lower equipment costs, according to research from Bloomberg NEF.

It said there would be a mixed picture for global clean energy investment in 2018 with dollar investment in solar under pressure, while commitments to wind power and energy smart technologies such as electric vehicles and batteries were running above last year’s levels.

World investment in clean energy in the first six months of 2018 stood at $138.2bn (£104.2bn), down by 1% from the same period in 2017. 

Within that, solar investment was down by 19% compared to the same period last year at $71.6bn, but wind power was up 33% at $57.2bn. 

Bloomberg NEF said the slippage in solar reflected significantly lower capital costs for photovoltaic projects, so that less money was needed to generate each megawatt.

At the same time, there had been a cooling-off in China’s solar boom and both trends were set to gather pace in the second half of this year.

BNEF’s head of Asia-Pacific, Justin Wu, said: “On June 1, the Chinese government released a policy document restricting new solar installations that require a national subsidy, with immediate effect. 

“We expect this to lead to sharp drop in installations in China this year, compared to 2017’s spectacular record of 53GW.”

The company’s senior solar analyst Pietro Radoia said this indicated there would be overcapacity in solar manufacturing globally, and so steeper price falls. 

The jump in wind power investment in the first half of 2018 came largely from major projects being financed in the US, Taiwan, India, the Netherlands and Norway. 

These included $1.5bn for the 731.5MW Borssele 3 and 4 offshore wind farm in Dutch waters, $1.0bn for the 478MW Hale County onshore wind project in Texas, and $627m for Taiwan’s 120MW Formosa 1 Miaoli project.

 

Image credit: iStock

Author: 

Mark Smulian is a freelance journalist

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