The world invested nearly twice as much in renewable energy production in 2017 than in coal and gas generation capacity, according to a new United Nations report. Data show that although investment in renewables is declining in Europe, it is growing substantially in China, with the country accounting for nearly half of global investment in clean energy.
The figures were published in the Global Trends in Renewable Energy Investment 2018 report, released on Thursday by UN Environment, the Frankfurt School-UNEP Collaborating Centre, and Bloomberg New Energy Finance.
For the eighth year in a row, global investment in renewables totalled more than $200 billion, or around €163.2 billion, in 2017, according to the report. The figures far exceeded new investment in coal and gas generation capacity, which is estimated at $103 billion. The report adds that since 2010, global investments in green energy sources amount to $2.2 trillion.
Solar energy led investment in new power generation, with investment worth $160.8 billion and a record 98 gigawatts of new solar capacity installed worldwide. A press release from Frankfurt School-UNEP Collaborating Centre notes that this is “far more than the net additions of any other technology.”
“The world added more solar capacity than coal, gas, and nuclear plants combined,” said Nils Stieglitz, President of Frankfurt School of Finance & Management, in a statement.
The report’s authors attributed the expansion of solar energy to the technology’s decreasing costs. A report released by the International Renewable Energy Agency (IRENA) earlier this year states that solar electricity costs dropped by 73% from 2010 to 2017. IRENA expects costs to continue to fall, thereby allowing solar to compete with or even undercut fossil fuels by 2020.
At $126.6 billion, China accounted for nearly half of global investment in renewable energy last year. The country saw significant growth in solar power – investment grew by 57% to reach $86.5 billion. Deutsche Welle reports, however, that China is still struggling to transition away from coal. The country burns more coal than any other nation and remains the top greenhouse gas emitter globally.
Comparatively, renewable energy investment in Europe dropped by 36% year-on-year to $40.9 billion in 2017. Lower investment in Germany and the United Kingdom contributed to the decline. In the UK, investment decreased by 65% to $7.6 billion, while in Germany it dropped 35% to $10.4 billion.
“In countries that saw lower investment, it generally reflected a mixture of changes in policy support, the timing of large project financings, such as in offshore wind, and lower capital costs per megawatt,” said Angus McCrone, chief editor of Bloomberg New Energy Finance.
The report states the UK’s drop in investment in renewables reflects “an end to subsidies for onshore wind and utility-scale solar, and a big gap between auctions for offshore wind projects,” while reduced costs per megawatt for offshore wind and “uncertainty over a shift to auctions for onshore wind” contributed to Germany’s lower figures.
Erik Solheim, head of UN Environment, welcomed the new report’s findings. “The extraordinary surge in solar investment, around the world, shows how much can be achieved when we commit to growth without harming the environment,” he said in a statement.
“By investing in renewables, countries can power new communities, improving the lives and livelihoods of the people who live in them, and at the same time cleaning up the air they breathe,” Solheim added.
Stieglitz cautioned that there was still work to be done: “This shows where we are heading, although the fact that renewables altogether are still far from providing the majority of electricity means that we still have a long way to go.”