NEW YORK Governments around the world have committed more than $200 billion toward technologies to cut dependence on fossil fuels, which should help keep green development moving despite the global economic crunch, an analyst for Deutsche Bank said on Tuesday.
Governments in the United States, Europe and Asia have also developed more than 250 policies since July last year that support alternative energy such as solar and wind power and climate-change mitigation.
"The activity shows that governments are very serious about continuing to tackle issues around renewable energy and climate change," Mark Fulton, the bank's global head of climate change investment research, told reporters in a teleconference about a report on green energy the bank released on Tuesday.
"We believe this trend ... will provide crucial support to climate change industries during the current global economic downturn, helping to offset the impact of weaker debt markets over time," he added.
In the United States, some $106 billion, or nearly 14 percent, of the $787 billion stimulus package President Barack Obama signed to help revive the economy is for green energy including tax breaks, loan guarantees and incentives. About $18 billion of the green investments in the package will help improve mass transit systems.
In the European Union, some $60 billion in stimulus packages will go to green measures, including more than $17 billion for energy efficiency and nearly $19 billion for clean cars.
Fulton said green mandates, such as requirements in U.S. states that utilities generate some of their electricity from renewable sources, and strong policies for solar power, such as feed-in tariffs in France, have been driving renewable markets in the short term.
"We think these mandates are very important in these difficult markets," Fulton said.
Twenty-eight U.S. states have adopted so-called renewable portfolio standards and environmentalists and many politicians also favor a national program.
In addition, loan guarantees for renewable energy in the U.S. stimulus package should help the markets develop despite the credit crunch, Fulton said.
In the long term the world's developing carbon markets should support green energy as companies invest in ways to reduce their emissions of gases blamed for warming the planet, he said.
The bank's report is available at dbadvisors.com/climatechange.
(Reporting by Timothy Gardner; Editing by Christian Wiessner)