In one of our few economic and environmental successes last year, global alternative energy deals climbed 40% to $53.5 billion.
Reuters recently reported that:
“Solar, wind and energy efficiency overtook hydropower as the main deal drivers for the first time. Hydro power has dominated renewables deal flow, but deals worth $1 billion or more in wind, solar, biomass and energy efficiency have outnumbered hydro by seven to one.”
This analysis is based on a PriceWaterHouse Coopers (PwC) research report.
Global clean energy investment hit a record $260 billion in 2011, which was mainly driven by explosive growth in solar in part resulting from the falling cost of solar panels. But, renewable energy, excluding hydropower, is only projected to account for 5% of the world’s total energy production by 2030.
However, the global alternative energy sector could face a tougher 2012.
PwC believes that:
“U.S. and European manufacturers will be under increasing cost pressures and some Chinese manufacturers will also face heavy debt and feel competitive strain.”
Significant overcapacity is projected for China, and PwC expects consolidation among larger players in the wind power sector. As I’ve reported previously, the end of certain tax programs and uncertainty about the future of domestic policy will also create increased development caution in the US.