Asset-backed financing of renewable energy projects jumped to a record €30.5bn in the third quarter of 2011, research has shown.
Much of the growth in asset-finance investment was in offshore wind farms. Three large offshore wind farms in the North Sea totalled more than 1 gigawatt in capacity and €4.6bn in investment, according to the research company Bloomberg New Energy Finance (BNEF).
The report underscores the growing importance of the renewable energy market to asset finance companies amid sluggish growth in other industry sectors.
There were also large financings for photovoltaic (PV), solar thermal and biofuel projects in the United States, a geothermal plant in Indonesia and onshore wind projects in Brazil and China, the report said.
New investment in clean energy – including not just asset finance, but also equity raisings on public markets and from venture capital and private equity funds – was €33.2bn in the third quarter, up 9% on the second quarter of this year and 16% ahead of Q3 2010.
Sharp falls in the cost of clean energy equipment over the past three years had attracted investors, said Michael Liebreich, chief executive of BNEF.
“There is still not enough demand to soak up significant over-supply, so prices and margins have remained under pressure and manufacturers’ share prices are being crushed,” he said. “The industry has swung between being a buyer’s market and a seller’s market a few times in recent years: right now, you would love to be a developer with access to funding, but not a supplier.”
The biggest asset finance deals in the third quarter were the €1.97bn financing of the Global Tech 1 offshore wind farm, off the coast of Germany, and the €1.31bn financing of the Djursland Anholt offshore wind project, off Denmark. The largest solar financing was €1.16bn for the High Plains Ranch II and III PV portfolio in the US.