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March 16, 2012

2011 Sees Record Installations for Wind and Solar
    by Robert Kropp

Clean Edge's 2012 trends report forecasts that the expansion of renewable technologies, which successfully weathered the economic downturn, will continue through 2021.

SocialFunds.com -- Last year's tenth anniversary report on cleantech from Clean Edge was largely a celebratory affair, noting that revenues for the three benchmark renewable technologies of biofuels, wind power, and solar photovoltaics had far outpaced the research firm's initial estimates from a decade earlier.

Free
SRI Mutual Funds GuideIn Clean Energy Trends 2012, Clean Edge notes, "The year 2011, however, will not likely be remembered for this robust growth and global activity, but for the now-infamous Solyndra bankruptcy." The thin film solar company's failure after receiving a $535 million Department of Energy (DOE) loan resulted in the portrayal by House Republicans of the loan guarantee as evidence of the Obama administration's "war on carbon-based energy" and exaggerated claims of new green jobs.

However, Clean Edge points out in its new report, "These criticisms… miss several key points." Fossil fuel industries continue to receive subsidies from the governments that far exceed those of renewable technologies, and nuclear power continues to require more loan guarantees than renewables. In fact, Clean Edge reports, two new nuclear power plants in Georgia recently received $8.3 billion in loan guarantees from the US government, 15 times that received by Solyndra and accounting for "nearly a quarter of all recent DOE loan guarantees."

However, "Clean tech isn't withering on the vine as some would proclaim, but instead is continuing its rapid expansion," Clean Edge states. "The industry as a whole has continued to expand throughout the economic downturn of recent years." The report projects that the three benchmark technologies, which grew from $188.1 billion in 2010 to $246.1 billion in 2011, will reach $385.8 billion by 2021.

Total market revenues for solar photovoltaics (PV) increased to $91.6 billion in 2011, despite a decline of more than 40% in module prices since 2010. Solar installations increased by more than 69%, from 15.6 gigawatts (GW) in 2010 to more than 26 GW worldwide. And according to a report released in late January by the US Energy Information Agency (EIA), shipments of PV modules in 2010 more than doubled, to more than 2.6 peak GW, despite a sluggish economy.

A report issued last week by the Solar Energy Industries Association (SEIA) corroborates Clean Edge's findings. SEIA reports that the US solar energy industry installed 1,855 megawatts (MW) of PV capacity in 2011, more than doubling that of 2010. According to the trade association, cumulative solar capacity in the US is enough to power four million homes.

New installation capital costs for wind power increased to $71.5 billion in 2011, and Clean Edge forecasts that the market for wind power will continue to expand, to $116.3 billion by 2021. A total of 41.6 GW of wind power came online in 2011, more than 40% of which occurred in China, which led in new wind installations for the fourth consecutive year.

According to the American Wind Energy Association (AWEA), more than 8,300 MW of wind energy installations are currently under construction.

While the market for biofuels increased to $83 billion in 2011, and is expected to grow to $139 billion by 2021, most of least year's increase was "due to an increase in ethanol and biodiesel prices," Clean Edge found. Overall, "global biofuels sales remained relatively flat, expanding from 27.2 billion gallons to 27.9 billion gallons of ethanol and biodiesel production worldwide."

The latest statistics on EIA's website cover renewable energy usage in 2009, when 10% of electricity production came from renewables, as did eight percent of consumption.

The American Solar Energy Society (ASES) has forecast that the renewable energy and energy efficiency industries could account for 37 million jobs, or 17% of total employment, in the US by 2030. According to the ASES forecast, there could be 1.3 million jobs in renewables by 2030, a 1,300% increase over 2007.

In 2007, ASES found, the sectors "generated more than 9 million jobs, more than $1 trillion in revenue, and nearly $160 billion in federal, state, and local tax revenues."

Clean Edge also produces three stock indexes that benchmark the clean-tech sector, and in 2011 all three—the NASDAQ Clean Edge Green Energy (CELS) index, which tracks US-listed clean-energy companies; the NASDAQ OMX Clean Edge Global Wind Energy Index (QWND), which tracks global wind power companies; and the NASDAQ OMX Clean Edge Smart Grid Infrastructure Index (QGRD), which tracks smart grid and grid infrastructure companies—were down significantly against a relatively flat S&P 500, "with retail investors perhaps questioning the relative lack of public market exit opportunities and an economic environment with severe government budget shortfalls," Clean Edge observed.

On the other hand, US-based venture capital investments in cleantech increased by 30% in 2011, to $6.6 billion, representing nearly one-quarter of all VC activity in the US last year.

"Venture capital is a risky, high-reward business critical to US innovation," the report states. "You can question whether government should be placing such bets, but there’s no denying that such risk is part of the American capitalist system, and something that’s historically been revered, not reviled, by business leaders and politicians alike."

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