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2005: Record Year for Investments in Renewable Energy

by VDW — last modified 2007-09-20 02:59 PM

Up from USD 30 billion in 2004 to USD 38 billion last year, 2005 was a record year for investment in the renewable energy sector. According to REN21, the Renewable Energy Policy Network, wind power capacity grew by 24% in 2005 to reach 59 GW, and ten countries added over 300 MW of wind power, up from five countries that had done so in 2004.

Other findings in the 2006 update include:

  • Biomass power production has increased by 50 -100% in several countries.
  • The US produced record amounts of ethanol fuel for cars, and three new EU countries became ethanol producers.
  • Biodiesel production grew by 85% in 2005 and nine new EU countries became producers.
  • Grid-tied solar power grew by 55%, led by Germany, now with more than 200,000 solar rooftops.
  • Solar hot water capacity grew by 23% in China and reached record levels across Europe.

The REN21 report estimates that at least 85 renewable energy companies or divisions have market valuations greater than USD 40 million, up from 60 companies or divisions in 2004. The estimated total market valuation of companies in this category is USD 50 billion, double the 2004 estimate, as several high-profile initial public offerings have recently taken place. The solar PV industry invested record amounts in new plant and equipment (about USD 6 billion), as did the biofuels industry (more than USD 1 billion).

Many new policies to support renewable energy were adopted over the past year, and many more were extended, revised, or discussed. Not only the EU and US were active, but more than 16 developing countries as well, including Brazil, China, Egypt, India, Mexico, Thailand, and Uganda.

Most notable was that a number of countries dramatically stepped up targets and mandates for biofuels – ethanol and biodiesel mixed with conventional fuels. The number of countries with so-called “feed-in” policies for the purchase of power from renewable sources increased to 41, and the number of countries with future targets for the share of energy from renewables increased to at least 49. Initiatives for grid-tied solar power multiplied, including new initiatives in the EU, California and other US states, Australia, and China.

These findings and more are contained in REN21’s 2006 update to its Global Status Report showing trends in renewable investment and policies worldwide.. The definitive version will be available on www.ren21.net soon.