Global funding for clean-energy projects sagged in 2018 after China’s decision to curb subsidies dragged down installations in the world’s biggest solar market.
Investment in wind and solar energy, along with technologies like smart power meters, reached $332.1 billion last year, down 8 percent from 2017, according to a report Wednesday from BloombergNEF.
China was again the biggest clean-energy spender at $100.1 billion, but that was down 32 percent from 2017’s record. A 53 percent drop in Chinese solar investment was a key driver in the worldwide decline, according to Jenny Chase, lead solar analyst at BNEF.
However, the top line number only tells part of the story. While global solar spending fell 24 percent, developers took advantage of lower costs to boost installations to about 109 gigawatts in 2018 from from 99 gigawatts the prior year.
“You’ve got a combination of two effects worldwide” for solar, Chase said in an interview. “You’ve got the capex-per-unit coming down and you’ve got unit-build going up.”
The cost of installing 1 megawatt of photovoltaic capacity fell 12 percent in 2018 as manufacturers slashed prices in the face of a module glut that was “aggravated” by China’s decision to cut solar subsidies, according to the report.
Offshore wind attracted $25.7 billion in 2018, up 14 percent from the prior year. Offshore wind projects financed in Europe included the $3.3 billion, 950-megawatt Moray Firth East array in the North Sea, along with 13 Chinese offshore farms for a total of about $11.4 billion. Money committed to wind energy, smart meters and electric vehicles all increased.
The U.S. was the second-biggest market for clean-energy investing with $64.2 billion, up 12 percent. Developers there have rushed to finance wind and solar projects to take advantage of U.S. tax credits before they expire early next decade.
Europe’s clean energy investment jumped 27 percent to $74.5 billion. Project developers in Europe and the U.S. benefited from a craving for renewable-energy power-purchase agreements by large energy users like Facebook Inc., and Alphabet Inc.’s Google.