Green Gold Trumps Black Gold

June 08, 2009

Investment in sustainable energy just sustained itself in 2008. But the actual investments look pretty sweet.

  • New investments up (a little) in 2008
  • Renewable winners and losers
  • A look at green ETFs


A funny little thing happened in 2008 - investment in new power generation from renewable sources and technologies beat out investment in traditional fossil fuel sources by $30 billion. This fact has been brought to you by the recent UN report titled, "Global Trends in Sustainable Energy."

Great news for climate change, right? Well, kind of. Despite all the investment, renewable energy is only responsible for 6.2% of global power capacity, so the green "revolution" still has a way to go.

"Global Trends in Sustainable Energy" is a report from the U.N. Environment Programme (UNEP) put together by units of the UNEP and New Energy Finance. In it (it's a long read), you'll find discussion of all the different types of investments in sustainable energy technologies and companies, and a look at the health of the sector from the perspective of money flows. The official executive summary is available, as is the full report.

Total global investment in sustainable energy grew to $155 billion in 2008. The good news is that that number grew from the previous year. The bad news is that it only grew 5%. Previous years showed huge gains, like a 73% increase in sustainable investment in 2005 from the year prior, and 59% growth from 2006 to 2007.


New Investment in Sustainable Energy, 2002 - 2008 ($B)


It's easy to understand what happened. The financial crisis hit the sustainable energy sector hard. Public investment in the sector (via the stock market) fell by 51%. The market for IPOs had the floor drop out of it, with only 18 occurring in 2008 (down from 48 in 2007) and no new offerings as of yet in 2009. It's not a bad time for alternative energy; it's a bad time for venture investing, and everyone is waiting for greener pastures and better economic times.

Of course, the fact that oil crashed and cratered with epic Tom Cruise-at-the-bar-scene extravagance certainly took the wind out of these alternative sails.

But still, there are some standouts.


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