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Why global solar spending fell in 2018

Solar panels in Cherynobl
Solar photovoltaic elements installations seen at the Chernobyl power plant. Photo: Pavlo Conchar/SOPA Images/LightRocket via Getty Images

Worldwide investment in renewables and other low-carbon energy sources dipped 8% last year to $332 billion, according to the consultancy Bloomberg New Energy Finance.

Why it matters: New year-end data show that the decline was driven by a sharp 24% drop in spending on solar projects, driven by 2 forces:

  • The ongoing drop in capital costs for the technology, fueled last year by a glut of panels on the market.
  • Policy changes in China, the world's biggest market, that lowered federal support and helped cut investment there by around half to $40 billion.

What they're saying: In an accompanying statement, BNEF analyst Jenny Chase notes that 2018 was a "difficult year" for panel manufacturers and developers in China, but adds...

"However, we estimate that global PV installations increased from 99GW in 2017 to approximately 109GW in 2018, as other countries took advantage of the technology’s fiercely improved competitiveness."

The big picture: Worldwide investment in clean energy has soared over the past 15 years from less than $62 billion in 2004 to consistently far above $300 billion over the last half-decade.

  • But while renewables deployment is surging, it's happening alongside rising global energy demand and growing fossil fuel use too.
  • That means the renewables surge isn't yet big enough to start sending global CO2 emissions downward.

By the numbers: A few other snapshots of the global picture...

  • Offshore wind investment grew by 14% to nearly $26 billion, while onshore wind grew slightly to around $101 billion.
  • Corporate R&D spending slipped 6% to roughly $21 billion, but government R&D rose 4% to $15 billion.
  • "Global venture capital and private equity investment jumped 127% to $9.2 billion, the highest since 2010," BNEF says.

Go deeper: See more of the data here.