(Corrects job title in paragraph six)
* Investment still lags fossil-fuel sector
* Global renewable power capacity 1,360 GW, up 8 pct
* Solar overtakes wind as prime renewable source
* Renewable shares perform poorly despite sector growth
By Henning Gloystein
LONDON, June 11 Renewable energy sources
supplied 16.7 percent of global energy consumption in 2011, but
the $257 billion of investment in the sector was still 15
percent lower than into fossil power generation, two influential
bodies reported on Monday.
The investments were a 17 percent increase on the previous
year and 94 percent higher than in 2007, the year before the
beginning of the financial crisis.
By the end of 2011, total renewable power capacity worldwide
exceeded 1,360 gigawatts (GW), up 8 percent on 2010, said two
reports published jointly by the United Nations Environment
Programme (UNEP) and the Renewable Energy Policy Network for the
21st Century (REN21).
Coal remains the world's top fuel for power generation,
followed by natural gas, according to the U.S. Energy
Information Administration (EIA).
The reports said that solar power generation had overtaken
wind as the prime renewable energy source, attracting nearly
twice as much investment in 2011. Total investment in solar
power jumped 52 percent to $147 billion.
"Despite the continuing economic crisis in some key markets,
and continuing political uncertainties, more renewable energy
was installed last year than ever before," said Mohamed
El-Ashry, chairman of REN21.
"Renewables comprised more than 25 percent of total global
power-generating capacity (estimated at 5,360 GW in 2011) and
supplied an estimated 20.3 percent of global electricity."
El-Ashry said that the growth of the renewables sector had
also been spurred by the Fukushima nuclear catastrophe in Japan
and by improvements in renewable-energy costs and technologies.
"As a result, renewable energy is spreading to more
countries and regions of the globe," he said.
The reports said that about 50 countries installed wind
power capacity in 2011 and that solar power generation capacity
had moved into new regions and countries, resulting in more than
200 million households using solar hot water collectors, and
that interest in geothermal power had taken hold in East Africa.
At least 118 countries had renewable energy targets in place
by early 2012, up from 96 a year before, though a drop in policy
support in developed nations was seen as a result of austerity
pressures in Europe and a legislative deadlock in the U.S.
FOSSIL FUEL INVESTMENT STILL BIGGER
Despite this growth, renewable power, excluding large
hydroelectric, accounted for less than half (44 percent) of all
new electricity generating capacity added worldwide in 2011. The
additions accounted for only 31 percent of actual new power
generated, owing to lower capacity factors for solar and wind as
a result of unfavourable weather conditions, the reports said.
The overall $257 billion that went into renewables - $237
billion of which went into green power capacity - still lagged
behind gross investment in fossil-fuel capacity in 2011, which
stood at $302 billion.
The reports said that in terms of total investment, the top
seven countries for renewable electricity capacity (excluding
large hydro) were China, the United States, Germany, Spain,
Italy, India and Japan, accounting for 70 percent of total
non-hydro renewable capacity worldwide.
"By region, the EU was home to nearly 37 percent of global
non-hydro renewable capacity at the end of 2011; China, India
and Brazil accounted for roughly one quarter."
RISING COMPETITION, WANING SUPPORT
Despite the additional investments, the reports said that
share prices in the renewable energy sector had performed poorly
in 2011 in the face of overcapacity in the solar and wind
manufacturing chains and investor unease about the direction of
support policies in both Europe and North America.
The reports also said that competitive challenges
intensified in the sector, leading to sharp drops in material
and component prices, especially in the solar market. While this
benefited buyers, the price drops had damaged manufacturers in
"Renewables are starting to have a very consequential impact
on energy supply, but we're also witnessing many classic
symptoms of rapid sectoral growth - big successes, painful
bankruptcies, international trade disputes and more," Udo
Steffens, president of the Frankfurt School of Finance and
Management, which collaborates with UNEP, said.
Faced with plunging green energy technology prices and
economic austerity measures, many governments sharply reduced
subsidies for renewables and allowed other support schemes to
expire, the reports said, resulting in a succession of company
failures and factory closures in 2011/12, including five
significant solar manufacturers in the United States and
"This is an important moment for strategic policymaking as
winners in the new economy form and solidify," Steffens added.
(Reporting by Henning Gloystein; Editing by David Goodman)