According to a report entitled ‘Global Trends in Renewable Energy Investment 2016’ published this month by the United Nations Environment Program (UNEP), the developing world including China, India and Brazil invested a record $156 billion in renewable energy technologies in 2015. This represents a 19% increase in the amount invested by developing countries in 2014. In 2015, China alone invested $102.9 billion, representing a 17% increase from their 2014 investment.

In contrast, developed countries invested $130 billion in renewable energies during 2015 – 8% lower than they invested in 2014. Investment in developed countries peaked at $191 billion in 2011, when there was an investment surge following a United States Treasury Grant and Federal Loan Guarantee Programs.

Renewable energies contributed nearly 54% of the capacity of all energy infrastructure installed globally in 2015

The ‘Global Trends in Renewable Energy Investment 2016’ report, a collaboration between the UNEP and Bloomberg New Energy Finance, highlighted this record global investment in renewable technology in 2015 – a record achieved despite sharp decreases in oil, coal and gas prices. As a result of this investment, a record 118 Gigawatts (GW) of wind and solar photovoltaics (PV) has been added to generating capacity worldwide. Renewable energies contributed nearly 54% of the capacity of all energy infrastructure installed globally in 2015, which was the first time renewables represented more than 50% of worldwide energy generation capacity.

Global investment in renewable energies in 2015 was more than double the amount invested in energy derived from coal and gas

Global investment in renewable energies ($265.8 million) in 2015 was more than double the amount invested in energy derived from coal and gas last year ($130 million). In addition to significant contributions from China, India and Brazil, Mexico ($4 billion) and Chile ($3.4 billion) joined the top 10 list of countries investing in renewable energy technology. Just outside the top 10 were Morocco, Uruguay, the Philippines, Pakistan and Honduras – all of which invested more than $500 million in renewable energy technology in 2015.

Renewable energy investment in Europe in 2015 fell by 21.1% to $48.8 billion. In the United States, investment increased by 19% to $44.1 billion which represented the country’s highest investment since 2011. Investments in solar energy accounted for approximately two thirds of that total. Japan invested $36.2 billion as a result of a boom in small scale PV since 2014.

According to the ‘Global Trends in Renewable Energy Investment 2016’ report, the cost of renewable energy generation continued to fall in 2015. From July to December 2015, the global average cost of solar PV fell to $122 per megawatt hour (Mwh). In the second half of 2014, the global average cost of solar PV was $143 per Mwh. The current record lowest cost per Mwh is a 200 megawatt (MW) plant in Dubai being built at $58.50 Mwh by ACWA Power International

Policy support for renewable energy technology is far from stable around the world. Last month in the United States, the Supreme Court allowed a number of objections to the Environmental Protection Agency’s (EPA’s) Clean Power Plan to be heard in June this year prior to the implementation of the plan. Objections include the potentially high cost of implementing the Clean Power Plan and the need for job security in coal producing states. Recent drops in the prices of coal, oil and gas may also tempt some developing countries to maintain their reliance on fossil fuel capacity.

There is also increasing interest in battery storage as an accompaniment to solar PV and wind projects. In 2015, 250 MW of storage was installed worldwide, which represented a greater than 50% increase on the 160 MW of storage installed in 2014. The potential of storage to help balance variable renewable energy generation in developed countries and in remote areas of developing countries is an area of focus for the UNEP according to its report.

Read the ‘Global Trends in Renewable Energy Investment 2016’ here

In the last 12 months I have read many reports and research articles on the rise of renewable energy technology around the world. I believe that renewable energy can make a significant contribution to decarbonising national (and ultimately) the global economy. It is also an important lever in the battle to reduce global greenhouse gas (GHG) emissions. The ‘Global Trends in Renewable Energy Investment 2016’ report makes it clear that the developing world has a thirst for renewable energy investment and deployment – evidenced by the $156 billion investment in renewable energies in 2015. In contrast, it is clear that the developed world needs to redouble its efforts to increase investment in renewable energy technology in order to play its part in ensuring their economies are decarbonised and reducing global GHG emissions. In addition to increasing the level of financial investment in renewable energy, developed countries need to strengthen their policies and legislation to ensure that this increase in renewable energy investment is encouraged on an ongoing basis.