Figures from Bloomberg New Energy Finance show that new funds for wind, solar and other low-carbon energy technologies grew 16% to $310 billion last year.
This growth was led by a surge in solar, with investment in this sector rising 25% to $149.6 billion and the trend looks set to continue into 2015 with BNEF predicting that installations for solar and wind power will grow around 10%.
Michael Liebreich, chairman of the advisory board for Bloomberg New Energy Finance, said:
Throughout last year, we were predicting that global investment would bounce back at least 10 per cent in 2014, but these figures have exceeded our expectations.
Those denouncing renewable energy sources as too expensive will also have to get off their soapboxes in 2015 with Deutsche Bank predicting that solar will be at grid parity in most of the world by the end of 2017.
Previous reports have shown this is already reality in Italy, Spain and Germany, while onshore wind is now the cheapest form of new electricity generation in Denmark.
China won the investment race in 2014, with a record $89.5 billion invested (up 32% on the previous year), while the US came in second with $51.8 billion. Japan and Canada also saw increases of 12% and 26% respectively.
But it is not only developed countries that are shifting their money into renewables. South Africa saw a 5% increase, and Brazil logged a massive 88 per cent increase in its investment, reaching $7.9 billion.
India also saw an increase in investment in 2014, reaching $7.9 billion – up 14% compared to 2013, while
Commentators optimistic that US president Barack Obama’s upcoming visit to India could see even greater progress on climate action and solar in the world’s second most populated country, while a partnership between energy companies in the two countries could see India’s largest ever solar plant built.
Despite a record year for wind in many countries across Europe, their investment lagged behind on investment, with just a 1% increase on the previous year.
While countries across the globe have been quick to take advantage of the momentum building around the clean energy transition, those failing to get on board are increasingly being left in the dust in the renewable energy race.
Australia stood out from the crowd last year, as plunging clean energy investment put the country behind some of the world’s smallest economies such as Honduras and Myanmar in the rankings.
BNEF warned that Australia had become “univestable” for large-scale projects, where an 88 per cent slump was seen in investment, taking it to its lowest levels since 2002.
Overall, clean energy financing dropped to its lowest level since 2009, with small-scale projects offering a lifeline for the country last year.