US and EU move gradually to renewable energy

Wind power averages annual grown of 27 percent.

By EHUD ZION WALDOKS
July 22, 2010 06:39
Illustrative photo

Wind turbines. (photo credit: Courtesy)

 
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New renewable energy capacity and investment are gradually surpassing that of conventional (coal, gas and nuclear) energy, according to the Renewables 2010 Global Status Report, which was released late last week.

Ren21: Renewable Energy Policy Network for the 21st Century published its fifth annual report alongside the UN Environment Program’s Global Trends in Sustainable Energy Investment 2010.

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Together, the two reports reveal interesting trends in renewable energy over the past several years. Among their major findings are that in 2008 and 2009, both the US and Europe added more new renewable energy capacity than new fossil fuel capacity.

Experts predict that this year or next, the entire world will be doing the same.

As of 2009, renewable sources constituted 25 percent of global electric power capacity (1,230 gigawatts) out of 4,800 GW total from all sources, including coal, gas and nuclear power, and 18% of all global power production.

Renewables represented 60% of newly installed power capacity in Europe, and more than 50% in the US. The world as a whole should reach 50% or more in newly installed power capacity from renewables in 2010 or 2011, according to the reports.

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The growing trend has been enabled by the explosion in the number of countries with some form of policy to encourage renewables. From 55 countries in 2005, more than 100 now have such policies, including Israel.

Despite a 10% drop, Europe continued to lead the world in investment in renewables, although Asia was not far behind – mostly because of interest in China, which has been making a huge push toward renewables. Chinese investments grew 53%, and 37 GW were installed, the most of any one country.

Overall, Asia invested $40.8 billion in 2009, up from $31.3b. in 2008. In fact, investment in Asia was significantly higher than investment in North Americas, which suffered a drop from $33.3b. to $20.7b. Investment in South America also slipped from $14.6b. to $11.6b.

If solar water heating and rooftop solar photovoltaic (PV) installation costs are taken into account, overall global investment continued to rise in 2009 despite the harsh toll the economic crisis has taken on other industries, according to the UN report.

The Middle East and Africa continued to increase investment, from $2.1b. in 2008 to $2.5b. in 2009. Israel appears in the tables and received brief mention for its solar water heating policies, which were ahead of their time when enacted 30 years ago.

Israel has also set a goal of producing 10% of its electricity with renewables by 2020, and a 20% cut in electricity demand by the same year.

Compared to other countries, Israel’s renewable energy sector is tiny and in its infancy. Roughly 30 MW out of more than 10,000 MW of electricity is now being produced from renewables.

Turning to a breakdown by technology, wind power continued to reap the major investments for the second year in a row.

“From 2005 to 2009 inclusive, the annual average rate of growth in wind power capacity was 27%; solar hot water 21%; ethanol production 20% and biodiesel production 51%. The use of biomass and geothermal for power and heat also grew strongly,” according to the Renewables 2010 Global Status Report.

Wind was even more dominant as a destination for investment in 2009 than in 2008, when it accounted for $59b. or 45% of all financial investment in sustainable energy. In 2009, it accounted for $67b. and its share rose to 56%.

Wind power additions reached a record high of 38 GW, 13.8 GW of which was installed in China, 10 GW in the US and 2.5 GW in Spain.

“Wind power existed in just a handful of countries in the 1990s, but now exists in over 82 countries,” the report disclosed.

Some Israeli entrepreneurs are attempting to increase the country’s capacity, and the Public Utility Authority- Electricity is working on a tariff. Nevertheless, much of the government’s focus has remained on solar energy.

Internationally, investment in solar PV reached a record $40b. in 2009. Remarkably, grid-connected solar power has grown by an average of 60% each year for the past decade, from 0.2 GW at the start of 2000 to 21 GW at the end of 2009.

Despite a drop in investment in 2009 for a variety of reasons, solar PV additions nevertheless reached a record high of 7 GW in 2009. Germany led with 3.8 GW added, or more than half of the global market. Other large markets included Italy, Japan, the US, the Czech Republic and Belgium. Spain, the world leader in 2008, saw installations plunge in 2009 after a policy cap was exceeded, the report noted.

An estimated 70 million households worldwide now employ solar hot water heating, the report assessed. Israel has been a pioneer in the field, with the first solar water heating panels being invented in the early 1950s, with mandatory installation in new buildings being enacted in 1980. The National Infrastructure Ministry estimates that three to 4% of Israel’s total energy demand is saved by solar hot water heating.

“On a per capita basis, Cyprus remained the world solar heating leader as of the end of 2008, with 527 kilowatts thermal (kWth) per 1,000 inhabitants, followed by Israel (371 kWth), where more than 80% of households heat their water with the sun,” according to the Renewables 2010 report.

“Israel for a long time was the only country with a national level mandate,” the authors wrote elsewhere in the report.

Bio-fuels accounted for the energy equivalent of 8% of global gasoline needs in 2009, with noted expansion in Latin America. However, bio-fuel investment dropped off in the US, Europe and even Brazil, and production capacity was not fully utilized.

Rounding out the list, geothermal power suffered a 29% drop in financial investment in 2009, to $2b. The Israeli company Ormat is the second- largest manufacturer of geothermal power plants in the world. It has had positive growth for the past five years.

Energy efficiency has been called a “virtual power plant” and the “first fuel,” since it reduces the need for more power plants. Apparently, the message is getting across as “power storage and efficiency saw a 34% rise in investment, to $4b.,” according to the report. “For the first time, energy-smart technologies attracted more venture capital and private equity investment than any other clean energy sector.”

In 2008, many countries, especially Europe and the US, pledged massive funding for renewables. Since late 2008, such “green stimulus” initiatives shelled out nearly $200b. However, this represented less than 10% of what was pledged. The two reports predicted that those projects would really get rolling this year and next.

According to materials provided by the organization, Ren21 is a global policy network that provides a forum for international leadership on renewable energy. Its goal is to bolster policy development for the rapid expansion of renewable energies in developing and industrialized economies.

In just five years, its global status report has become the most frequently referenced report on renewable energy business and policy, serving a wide range of audiences from investors and government decision-makers to students, project developers, researchers and industrial manufacturers.

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