Investments in solar power overtook those in wind power for the first time in 2011, and the latest deals suggest this is only the start, says a new report by energy industry experts GlobalData. As the report explains, renewable energy is becoming increasingly important in developing nations across North Africa and Asia, and with such a readily available and abundant source, it is solar power that is attracting the big money.

In China (a major renewable power investment hub) a series of solar power projects have been declared to meet the demand from the Middle East and North Africa (MENA), but also to fulfill its own requirements. Notably, Shandong province is currently implementing its ‘One Million Rooftops Sunshine Plan’, with the stated goal of stimulating the integration of solar panels into building construction.

Now emerging markets across the (MENA), Eastern Europe, Latin America and South east Asia are aiming to grow their renewable energy production with an increased presence in the solar sector. UAE and Algeria, among several other MENA nations, are focusing their renewable energy efforts in solar power, India’s National Solar Mission will drive investment in the Subcontinent, and the Malaysian government has set a renewable energy target of more than 3,140 megawatts by 2020, with solar power expected to account for one-third of the total capacity.

This new focus has upped demand for solar PV modules, set to be met by manufacturers in South east Asia. GlobalData expects Japan, Taiwan, Republic of Korea, and in particular, China, to be the major equipment manufacturers in the years to come.

The explosion in solar power’s popularity is attributed to the glut of PV modules that hit the market last year due to over production – an occurrence that lowered prices and vastly increased capacity installations. As a consequence, cost of generation approached grid parity in certain locations and attracted a wealth of asset financing investments.

According to 2011 figures, investments in solar power accounted for 49% of the $209 billion global renewable energy industry, compared to the once dominant wind sector, which claimed 34%. Biopower, geothermal and small hydro investments made up the remaining 17%.

After a sharp falloff in 2010, investments in the UK’s clean energy sector rebounded in 2011 to $9.4 billion – a 35 percent increase and the seventh highest among G-20 nations, according to new research by The Pew Charitable Trusts. The growth was driven in part by a 10-fold increase in solar energy investments, which rose to $4.8 billion, financing the installation of more than 300 megawatts (MW) of power in 2011. Sustained interest in development of offshore wind turbines also helped to spur $2.3 billion worth of investment and 900 MW of capacity in the wind sector. To date, the UK has installed 6.4 GW of wind capacity.

“While solar investment saw the most significant growth in the UK, offshore wind is poised for significant future investments and capacity additions,” says Phyllis Cuttino, director of Pew’s Clean Energy Program. “In part, investment growth in the United Kingdom can be attributed to investors initiating new projects before policy incentives are curtailed. To maintain growth, the UK must provide consistent, long-term market signals that provide certainty to investors.”

Globally, investment grew to a record $263 billion in 2011, a 6.5 percent increase over the previous year. The United States reclaimed the top spot among all G-20 nations and attracted $48 billion. However, with $45.5 billion in private investments, China continued to be a hub of clean energy activity – leading the world in wind energy investment and deployment, as well as wind and solar manufacturing. Germany received $30.6 billion, ranking third among G-20 nations. The combination of falling prices and growing investments accelerated installation of clean energy generating capacity by a record 83.5 GW in 2011 bringing the total to 565 GW globally. This represents nearly 50 percent more than installed nuclear power capacity worldwide by the end of the year.

“The clean energy sector received its trillionth dollar of private investment just before the end of 2011, demonstrating significant growth over the past eight years,” points out Michael Liebreich, chief executive of Bloomberg New Energy Finance, Pew’s research partner. “Solar installations drove most of the activity last year as the falling price of photovoltaic modules, now 75 percent lower than three years ago, more than compensated for weakening clean energy support mechanisms in a number of parts of the world.”

Offshore wind energy capacity increased in the first half year of 2011, with a 4.5% rise in installations compared to the corresponding period of 2010. According to the European Wind Energy Association (EWEA), 101 new offshore wind turbines, with a total capacity of 348 Megawatt (MW), were connected to the power grids in the UK, Germany and Norway during the first six months of 2011.

Eleven offshore wind farms worth some Eur8.5 billion and with a total capacity of 2,844 MW are currently under construction in European waters. The size of the installed offshore wind turbines averaged 3.4 MW – up from an average of 2.9 MW during the first half of 2010.

“While I see several positive trends for the European offshore wind power industry, we are not home and dry yet. The sector is coming out of the financial crisis but is still facing a potential worsening of the general economic crisis. The number of banks providing capital for offshore wind farm investments is steadily growing, although there is a continued need for attracting an increasing number of large institutional investors to offshore wind farms – presently the largest construction projects going on in Europe,” says Christian Kjaer, chief executive of EWEA.

Several wind farms in Germany and the UK will reach financial close in 2011 and financial institutions will this year provide a record amount of financing to the sector of over Eur3 billion. Between three and five transactions are expected to close during the course of the year. Equity financing, including divestment of stakes in existing projects to initiate new ones, highlights new approaches to financing among developers and power companies following the financial crisis.

At the end of June 2011, there were 1,247 offshore wind turbines fully grid connected with a total capacity of 3,294 MW in 49 wind farms spread between nine European countries.

NI Water has completed a major new reservoir at Ballylone. The new reservoir will increase the security and flexibility of the water supply for over 5,000 customers in the Ballynahinch, Crossgar and Killyleagh areas.

Almost £1 million was invested in this new reservoir, which has a capacity of approximately 5.6 mega litres. This is the equivalent to the amount of water needed to fill approximately 2 Olympic size swimming pools.

”This project is just one example of the level of investment required to improve water and wastewater services throughout Northern Ireland,” says project manager, Gary McFadden.

The contractor for the Ballylone Reservoir Project was Lagan Construction, with McAdam Design as designers and Capita Symonds as project managers.

Energia has opened a new €18 million, 10.2 megawatt (MW) extension to the Drumloughhill Wind Farm in County Donegal.

Peter Baillie, managing director of Energia Renewables, comments: “The company has consistently been one of the largest investors in the renewable sector and invested a significant €200 million in the last two years in over 100MW of wholly owned wind farm developments and has supported third party wind generator investments of €600 million in over 370MW of wind farms throughout Ireland.”

Dinny McGinley, TD, Minister of State at the Department of Arts, Heritage and Gaeltacht (left), lends a helping hand to Tom Gillen, chief operating officer, Energia Group, and Peter Baillie, managing director of Energia Renewables, as they carry props for photographs at the official opening of the new Energia 10.2 megawatt extension to the Drumloughill Wind Farm.

The extension was officially opened by Dinny McGinley TD, Minister of State at the Department of Arts, Heritage and the Gaeltacht. The 10.2 megawatt (MW) wind farm is owned by Energia and the ‘off take’ electricity is sold to business customers around Ireland.

Tom Gillen, chief operating officer at Energia, says: “Energia is proud to be one of Ireland’s leading low-carbon-intensity energy suppliers, with over 300MW of operational wind farms, and a further 540MW in development. This is set to increase to over 840MW of Ireland’s renewable power, or around 25% of the Irish renewable market, by 2013. This puts us at the top of list of those helping Ireland reach the targets of sourcing 40% of our energy from renewable sources by 2020.”

Energia has a 28% market share of the Irish business electricity and gas market supplying the energy needs of over 65,000 business customers. In addition to renewable assets, the company also operates a 750MW gas fired power station in north Dublin, where the Energia has invested €500 million.

Energia recently signed a preliminary off-take agreement to purchase the electricity generated from the pioneering Wave Energy Converter being operated by US firm Ocean Energy Systems (OES) off Belmullet, County Mayo.

NI Water has been fined £2,000 after pleading guilty to causing a pollution incident from Masserene Sewage Pumping Station (SPS) in the vicinity of Clotworthy Bridge, Antrim on May 3rd 2010. The incident was linked to a blockage caused by inappropriate items that resulted in a discharge into a nearby watercourse.

NI Water has asked for the publics’ assistance in reducing pollution incidents by not placing inappropriate items in the toilet, down a drain or into the sewers. “Inappropriate items include cotton buds, nappies, sanitary items, household wipes and condoms which regularly make their way through the sewerage system and block the pumps at our Pumping Stations. This can cause harm to property, wildlife and the environment,” explains a spokesperson for NI Water. “Whilst NI Water has a responsibility for the sewerage system, everyone in Northern Ireland can help reduce pollution incidents. The advice is simple, only toilet roll and human waste should be flushed down the toilet, for everything else – bag it and bin it, don’t flush it.”

Throughout the process, NI Water cooperated fully with the Northern Ireland Environment Agency. NI Water is working to reduce these occurrences by investing in water and wastewater services to bring them up to an acceptable standard and is pleased to announce that a new, replacement SPS became operational in September 2010. With completion of investment programmes such as this, NI Water is confident that pollution incidents will become less common.

Bord Gais Eireann is showing strong growth in its gas and electricity businesses, continued development of new assets and a significant increase in its energy customer numbers. Despite the challenging domestic environment, the company performed well in 2010. Turnover grew by 12% to Eur1.51 billion, while profit before tax remained relatively stable at Eur120 million. EBIDTA increased year on year by 8% to Eur354 million before exceptional items.

Concerns during the period included the increase in international wholesale energy prices and a significant uplift in customer bad debt. By the end of 2010, Bord Gais had approximately one million customers, including 460,000 electricity customers.

The development and acquisition of significant power generation assets is a strategic priority for Bord Gais, so the commissioning of the Whitegate Power Plant in County Cork was a major landmark for the company in 2010. Whitegate is one of the most efficient electricity generation facilities in the world today. It is the company’s first major gas-fired power station and cost Eur400 million to develop.

In 2010, the company invested Eur200 million in capital projects to support the delivery of a balanced portfolio of secure, competitive and efficient energy solutions, including renewables, to customers. This brings the company’s total capital expenditure in the last five years to Eur1.97 billion.

John Mullins, chief executive of Bord Gais.

“The 2010 performance sees the company on target to meet the objectives set in out in the five year strategic plan published in 2008,” says Rose Hynes, chairman of Bord Gais. “Bord Gais Eireann is continuing to make substantial progress with key milestones being realised such as the achievement of one million customers, continued investment in developing wind farms and alternative technologies and the commissioning of Whitegate.”

However, the issue of bad debt reached a critical level in 2010 and Bord Gais has made a provision of Eur26.4 million in its 2010 accounts.

John Mullins, chief executive of Bord Gais, comments: “Looking forward, international wholesale energy prices remain a concern and this will put increasing pressure on prices throughout 2011. Another key challenge facing the company this year is that Bord Gáis is the only regulated provider in the gas sector, and as such, faces considerable constraints in terms of its ability to compete on a level playing field. This needs to be addressed urgently.”

The UK is failing to attract the level of investment needed to build low-carbon infrastructure, according to a new CBI report. With a third of UK energy supply due to close in the next decade and ambitious emissions reductions targets to meet, the UK’s power sector alone needs £150 billion of private sector investment over the next twenty years.

However, a new CBI report,’Risky Business: Investing in the UK’s low-carbon infrastructure’, reveals that senior business leaders are not convinced that the UK can attract low-carbon investment at the scale and pace required.

Over the next few decades, the UK faces a unique investment challenge. The key to hitting its stretching legal emissions targets will be the ability to generate the large and sustained investment needed to replace and decarbonise the energy infrastructure. The UK Government will need to show leadership and ingenuity in making this investment happen.

The report sets out recommendations on how the Government should respond to this challenge. The report argues that:

* Low-carbon investment is vital for the UK;

* The pace and scale of investment is a barrier to success;

* Government must take action to set the right investment conditions:

* Addressing policy and market risk must be a priority;

* A Green Investment Bank can be an important investment enabler.

“Businesses want to get on with building new low-carbon infrastructure, but there is still too much policy uncertainty. We need the Government to set a clear direction of travel and to stick to it,” comments Katja Hall, chief policy director for the CBI. “Electricity Market Reform is a positive start but more needs to be done to provide wider policy certainty for low-carbon investment. It is particularly important that the planning system delivers timely decisions and there are no more sudden policy shifts as we saw with the Carbon Reduction Commitment. The Green Investment Bank needs to issue bonds as soon as possible to provide a secure bridge between pension funds and capital intensive technologies.”

Tata Steel, Europe’s second largest steel producer, has invested £53 million at its plant at Port Talbot in Wales to reduce its external power requirements by about 15% and contribute towards making the site self-sufficient in energy.

The investment will introduce a new cooling system in the Basic Oxygen Steelmaking (BOS) plant that will have the benefit of producing steam, allowing electricity to be generated. The resulting reduction in energy consumption will improve the sustainability of steelmaking in Wales. The 10MW of energy that will be saved would be enough to power an estimated 20,000 homes.

The main project work will be carried out in the second half of next year, in parallel with the £185 million rebuilding of Port Talbot’s No 4 blast furnace. The investment also follows the £60 million BOS plant Energy Recovery project, which was completed in May last year.

For the third year in a row, Airtricity, Ireland’s largest independent energy utility, has won the national Green Energy Award 2011. 66% of the electricity supplied by Airtricity to its 500,000 electricity customers comes from renewable sources.

“We recognise that small changes in the way our customers consume their energy can make a big difference to Ireland’s CO2 emissions as well as to the size of our customers’ energy bills,” comments Kevin Greenhorn, chief executive of Airtricity. “The simplest and most effective way for electricity customers to reduce their carbon footprint is to choose Airtricity for electricity that emits on average nearly 60% less C02 per MWh. However, once this first step is taken, we then work with our customers to help them reduce their energy consumption through practical energy efficiency advice and actions.”

Airtricity is Ireland’s biggest investor in green energy. From its foundation in 1997 to the end of its current financial year (April 1st 2011), Airtricity has invested Eur1billion in renewable energy in Ireland – an investment that is unmatched by any other energy company in the Irish energy sector.

Airtricity is powered from Ireland’s largest wind generation portfolio, which comprises over 500MW of renewable energy from 25 wind farms across the country, including power from Ireland’s largest wind farm – the 72MW Meentycat Wind Farm in County Donegal. In 2010, Airtricity recorded 854 GWh of wind energy output in Ireland – the largest of any supplier in the market.

Airtricity is also Ireland’s largest renewable energy developer with 730MW of Irish onshore and offshore wind farm generation in construction or with consent for development, in addition to over 500MW of generation already in operation.

CAPTION:

Pictured at the Green Awards 2011 was Gerald O’Neill (left) from Amarach presenting the Green Energy Award to Kevin Greenhorn (centre), chief executive of Airtricity, and Jason Cooke (right), head of communications at Airtricity. Picture Conor McCabe Photography.

China added 18.9 GW of new wind power capacity last year to reach a total installed capacity of 44.7 GW, according to the Global Wind Energy Council (GWEC). The new numbers for China also result in revised figures for global wind power growth in 2010, with the new capacity added over the year amounting to 38.3 GW (close to the 2009 market), taking the total to 197 GW, which represents a 24% growth.

“China has become the single largest driver for global wind power development. In 2010, every second wind turbine that was added anywhere in the world was installed in China.” says Steve Sawyer, secretary general of GWEC.

China’s wind market doubled every year between 2005 and 2009 in terms of total installed capacity, and it has been the world’s largest annual market since 2009. In 2010, China overtook the US as the country with the most installed wind energy capacity.

This strong growth in China has had a significant impact on the market shares of wind turbine manufacturers, which see Chinese companies increasing their overall shares of the global wind markets. Indeed, four out of the top ten global wind turbine manufacturers are now Chinese, with Sinovel and Goldwind ranking second and fourth respectively. Domestic manufacturers now supply more than 50% of the equipment used in Chinese wind power projects.

According to Bloomberg New Energy Finance, the growth in installed capacity was driven by a record level of investment in wind power in China, which exceeded $20 billion in 2009. In the third quarter of 2010, China’s investment in new wind power projects accounted for half of the global total.

The Chinese government report Development Planning of New Energy Industry optimistically calculated that the cumulative installed capacity of China’s wind power will reach 200 GW by 2020 and generate 440 TWh of electricity annually, creating more than RMB250 billion (Eur28 billion or $38 billion) in revenue.

The Chinese government’s twelfth Five-Year Plan, which was passed by the Chinese Parliament in March 2011, reflects the Chinese government’s continuous and reinforced commitment to wind power development, with a target of building an additional 90 GW of wind energy by 2015.

Building on its successful relationship with Northern Ireland Water, WYG has won a contract to help improve water quality for residents of east Belfast. The Leeds-based consultancy will be designing, managing and co-ordinating construction design management on a new £750,000 project to reduce out-of-sewer spills to water courses. This project forms part of a larger eight year framework.

For over seven years, WYG has been managing Northern Ireland Water’s Integrated Wastewater Framework which is designed to reduce the risk of flooding and improve water quality for the eastern region of Northern Ireland.

“Since the project is located centrally in the Connswater Greenway scheme, the design and construction work will be undertaken considerately to its surroundings. The Greenway will create a 9km linear park through east Belfast, following the course of the Connswater, Knock and Loop Rivers, which makes the location environmentally sensitive,” comments Ernie Spence, associate of WYG. “Throughout the project we will be focused on alleviating disturbance to the surroundings, working in a sustainable manner through the design and construction phases. Our design involves converting concepts developed using hydraulic modelling into buildable solutions, whilst minimising environmental impact and providing value for money.”

Northern Ireland has inherited a legacy of acute underinvestment in water and sewerage systems, which has led to significant disparity when compared with the rest of the UK’s water industry, in particular in the areas of out of sewer flooding and water mains leakage. However, last year saw some £778m being invested in water and wastewater infrastructure – £174m in water treatment and storage facilities and mains improvement and £614m in wastewater collection and treatment systems.

WYG will be replacing a combined sewer overflow chamber, associated pipework and outfall structures. The project is anticipated to be completed in December 2011.