Originally published January 20 2006
Global investment in new energy needs to increase five-fold
by Mike Adams, the Health Ranger, NaturalNews Editor
Even with the boom in new energy investment peaking at 42.2 billion in 2005, analysts like Michael Liebreich of New Energy Finance claim that worldwide demand for new energy will reach $650 billion this year.
Total global investment in renewable energy and low-carbon technologies in 2005 was approximately $42.2 billion, with the total value of financial transactions such as M&A activity exceeding $56 billion, according to a study released Thursday.
"At over $42 billion in annual investment volume, the clean energy industry worldwide has achieved a meaningful scale," said New Energy Finance CEO Michael Liebreich.
His London-based research firm studied nearly 11,000 organizations in the clean energy industry, along with more than 4,000 transactions.
However, he said the $42.2 billion represented only 6.7 percent of the estimated $630-billion total worldwide annual demand for energy industry investment.
For a meaningful switch from fossil fuel sources to occur, he believes clean energy investment needs to increase fivefold over the next decade, and grow 20 percent per year.
- ADVERTISEMENT The firm estimates the current level of annualized venture capital and private equity investments reached $1.7 billion, 73 percent of which occurred in North America.
For clean energy IPOs and secondary offerings, New Energy estimates that current annualized public market fundraisings have reached $4.2 billion.
Wind energy leads the way in clean energy IPOs and secondary offerings at $1.5 billion from 2001 to 2005, followed by solar with $1.4 billion.
Fuel cells were $496 million, while biofuels reached $254 million.
New Energy believes the volume of clean energy investment is large, growing, and diversified by asset class, geography, and technology.
However, the firm cautions that the investment volume is far from the volume and profile needed to match the growth in global energy use.
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