Renewable energy investments were down worldwide in 2012, but the money that was spent was primarily invested by developing nations. While Africa and the Middle East ramped up renewable energy production, the United States cut batch 34 percent, losing its first-place status in renewable energy investment to China.
According to the United Nations Environment Programme (UNEP) and REN21, a renewable energy policy group in France, 2012 was the first time since 2009 that global investment in renewable energy sources declined. Worldwide, spending on renewable energy sources fell from $279 billion dollars in 2011 to $244 billion in 2012. Before 2009, financial expenditures had increased every year beginning in 2004. China alone is responsible for $67 billion dollars of the money spent on renewable energy sources last year.
"The main reason for the decline in 2012 was investor concern over policies to support renewable energy in its longest-established markets, Europe and the U.S.," UNEP said.
A glut of large-scale photovoltaic systems has lowered prices by 40 percent on average, further dampening the market.
Investment in renewable energy sources by developing nations, meanwhile, reached a new high of $112 billion dollars, or 46 percent of all money spent on such plants. Spending by nations with larger economies in 2012 dropped to $132 billion dollars. The difference in spending between industrialized nations and the third world, now just 18 percent, was 250 percent in 2007. This move was fueled in part by increased demand in those areas, as well as geographical advantages for the economical production of solar and wind power.
Total electrical production from renewable energy sources, however, went up in 2012 to 1,470 gigawatts (GW) of electricity, about 40 percent of which comes from wind power. The remainder of the production is largely split between hydroelectric and solar. Around 48.4 GW of new wind power was installed over the course of 2012, along with 30.5 GW in new solar construction. Both of these numbers are record annual highs for the technologies.
Developing nations that increased their renewable energy investments in 2012 include South Africa, Morocco, Kenya, Mexico and Chile.
"The uptake of renewable energies continues worldwide as countries, companies and communities seize the linkages between low-carbon green economies and a future of energy access and security. More and more countries are set to take the renewable energy stage," Achim Steiner, UN Environment Program Executive Director, said.
So, while investment worldwide is down, supporters of green energy can take solace that the production of electricity by renewable means is up, especially in third-world areas where the move is likely to reduce future demand for fossil fuels.