Even the reduced investments were nearly double what went into adding fossil fuel capacity. But the report also notes a “marked slowdown” in big markets like South America, Japan, and China, which have been pouring money into wind and solar power in a bid to meet emissions-reduction pledges and reduce their notorious smog levels. Reduced growth in demand and shifts in governmental support contributed to that slowdown.
That may signal that the field is entering a “consolidation phase,” as countries shift toward integrating more renewables into their power systems, said Michael Liebreich, who chairs the Bloomberg New Energy Finance advisory board.
“You’ve got a number of countries working to swallow some very rapid updates in renewables in the last five years or three years,” Liebreich said. “We don’t see a sudden return to vast growth in the number of dollars invested around the world. We would see this year as being broadly in line with last year … we’re definitely not going to see a collapse, because these technologies are cheap.”
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The report notes that renewables “remain vulnerable to unfriendly twists in policy, or to measures that set out directly to protect coal and gas.” The United States appears ready for one of those unfriendly twists, with the Trump administration trying to roll back its predecessor’s efforts to reduce emissions from the power and automotive sectors and boost the sagging American coal industry.
However, Liebreich said, “There’s a long way to go to turn those into actual policies.” In the meantime, policymakers worldwide are shifting away from subsidizing clean energy toward building markets in which cheap renewables are “the default option.”
“The default now is if you need power, whether you’re a company or whether you’re a utility, the first palce you look is can you do renewables — can we meet this demand with renewables, because it’ll be cheaper?” he said.
Many developing countries still lean heavily on coal plants. But investors also put up nearly $10 billion for wind and solar projects in India, where a nearly 650-megawatt complex went online in 2016. That’s currently the world’s largest — but bigger solar projects are being planned in the Middle East and Mexico this year, said Angus McCrone, the report’s chief editor.
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