Despite the drop, 2012 was the second-highest ever investment year after a record-setting year in 2011, helped by a 20 percent year-on-year rise in Chinese investments.

“Rumours of the death of clean energy investment have been greatly exaggerated. Indeed, the most striking aspect of these figures is that the decline was not bigger,” said Michael Liebreich, chief executive of Bloomberg New Energy Finance.

China regained its position as the world’s biggest clean energy investment market last year with a record $67.7 billion spent on the back of a surge in its solar market.

Investments in the world’s second-biggest market, the U.S., fell 32 percent year on year to $44.2 billion due to concerns over tax incentives for wind farms and strong competition from gas-fired power plants due to a sharp drop in gas prices.

Spain and Italy saw investment declines of 68 percent and 51 percent respectively due to renewable energy policy changes.

South Africa and Japan were two countries that saw strong growth in clean energy investment last year, with South Africa attracting $5.5 billion through its tender for wind and solar power projects.

Japan’s post-Fukushima focus on renewables led to a 75 percent spike in investments of $16.3 billion.

Asset finance of utility-scale renewable energy projects accounted for the largest type of investments, with $148.6 billion, followed by small-scale project investment, mainly rooftop solar plants, at $80.2 billion.

The solar market was the dominant investment sector across the globe at $142.5 billion, but the total was down 9 percent on the previous year also due to the fact that module prices fell by around 24 percent.

(Reporting by Karolin Schaps; Editing by Mike Nesbit)

Source: Economic Times