Policy uncertainty and plummeting solar prices led to a 14-percent decrease in investment in renewable energy in 2013, according to a report. Investment fell across the globe, even in high growth regions like China, India and Brazil. But it was severe cuts in Europe – until recently a pace-setter for the rest of the world – that marked the retrenchment. In 2013, European countries spent $48 billion less than the year before.
A rise of more than two degrees centigrade over the year 1900 temperatures would have catastrophic consequences in much of the world. Unless significant cuts are achieved in existing emissions, the goal of renewables risks changing from serving as a solution to just another corollary low-cost fuel for increased growth. Though most models predict global energy use tapering off by mid-century, without cuts or a rethinking of axiomatic growth, it will be too late by then to head off climate change’s most cataclysmic impacts. The report, jointly released by the U.N. Environmental Programme (UNEP), the Frankfurt School and Bloomberg New Energy Finance, could only highlight a “trickle of significant” projects of the kind that possibly could supplant – not supplement – traditional power generation on a wide scale and curb carbon emissions.
Renewables increased their share of global power generation from 7.8 to 8.5 percent. Still, they have not been able to displace rising coal consumption in the developing world and continue to staunch carbon growth rather than reduce it overall. Though last year renewables prevented an estimated 1.2 gigatonnes of carbon from being released into the atmosphere, global emissions still grew by 2.1 percent.
“On their own, renewables investment will certainly not grow fast enough to put the world on a two-degree compatibility path,” said Ulf Moslener, head of research at the Frankfurt-School-UNEP Collaborating Centre for Climate & Sustainable Energy Finance, referring to the temperature threshold. Moslener says the post-crisis investment climate and the Basel III global regulatory framework makes investing in alternative energy less attractive to large funds and institutional investors who seek higher leverage to cover the higher up-front costs associated with renewable projects. The Frankfurt report found that venture capitalists and private equity companies cut back considerably in 2013, reducing investments in specialist renewable energy companies to only two billion – their lowest levels since 2005. The main tracking index – The WilderHill New Energy Global Innovation Index (NEX) – is still 60 percent below its 2007 peak.
A study commissioned last year by the Norwegian government predicted “the capital and liquidity requirements of Basel III are likely to limit the amount of capital available for renewable energy financing from banks in the future.”
“The financial system we have today is based on a construct that is not helpful to sustainable development,” says Eric Usher, chief of the finance unit in the U.N. Environmental Programme’s Division of Technology, Industry and Economics.
SOYMB could have told him that !!
A rise of more than two degrees centigrade over the year 1900 temperatures would have catastrophic consequences in much of the world. Unless significant cuts are achieved in existing emissions, the goal of renewables risks changing from serving as a solution to just another corollary low-cost fuel for increased growth. Though most models predict global energy use tapering off by mid-century, without cuts or a rethinking of axiomatic growth, it will be too late by then to head off climate change’s most cataclysmic impacts. The report, jointly released by the U.N. Environmental Programme (UNEP), the Frankfurt School and Bloomberg New Energy Finance, could only highlight a “trickle of significant” projects of the kind that possibly could supplant – not supplement – traditional power generation on a wide scale and curb carbon emissions.
Renewables increased their share of global power generation from 7.8 to 8.5 percent. Still, they have not been able to displace rising coal consumption in the developing world and continue to staunch carbon growth rather than reduce it overall. Though last year renewables prevented an estimated 1.2 gigatonnes of carbon from being released into the atmosphere, global emissions still grew by 2.1 percent.
“On their own, renewables investment will certainly not grow fast enough to put the world on a two-degree compatibility path,” said Ulf Moslener, head of research at the Frankfurt-School-UNEP Collaborating Centre for Climate & Sustainable Energy Finance, referring to the temperature threshold. Moslener says the post-crisis investment climate and the Basel III global regulatory framework makes investing in alternative energy less attractive to large funds and institutional investors who seek higher leverage to cover the higher up-front costs associated with renewable projects. The Frankfurt report found that venture capitalists and private equity companies cut back considerably in 2013, reducing investments in specialist renewable energy companies to only two billion – their lowest levels since 2005. The main tracking index – The WilderHill New Energy Global Innovation Index (NEX) – is still 60 percent below its 2007 peak.
A study commissioned last year by the Norwegian government predicted “the capital and liquidity requirements of Basel III are likely to limit the amount of capital available for renewable energy financing from banks in the future.”
“The financial system we have today is based on a construct that is not helpful to sustainable development,” says Eric Usher, chief of the finance unit in the U.N. Environmental Programme’s Division of Technology, Industry and Economics.
SOYMB could have told him that !!
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