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BNEF: EV company fundings bright spot as clean energy investment slips in Q3 quarter; 3 China EV companies raise $1.9B

Global clean energy investment was $67.8 billion in the third quarter of 2018, down 6% from the same period last year, according to the latest Clean Energy Investment Trends report from research company Bloomberg NEF (BNEF).

Bloomberg

The slip in the July-September quarter leaves clean energy investment for the year so far running a modest 2% below that in the first nine months of 2017—leaving open the possibility that 2018 as a whole will end up matching last year’s total, particularly if a few more multibillion-dollar offshore wind deals are concluded before Christmas.

BNEF includes equity raising by specialist electric vehicle companies in its clean energy investment totals, and this element was a conspicuous bright spot in the latest quarter. There was a $1-billion initial public offering by NIO, a $585-million Series C venture capital round by Guangzhou Xiaopeng Motors and a $294-million pre-IPO round by Zhejiang Dianka Automobile.

Colin McKerracher, head of advanced transport analysis at BNEF, said that there is a growing amount of money chasing China’s electric vehicle boom.

We’re seeing more companies raising funds as they look to make the jump from concept cars to high-volume manufacturing. But the market looks increasingly crowded and consolidation is likely.

—Colin McKerracher

Looking at the third-quarter global investment figures by type, asset finance of utility-scale renewable energy projects came to $49.3 billion, down 15% on 3Q 2017, while the purchase of small-scale solar systems of less than 1MW totaled $13.5 billion, up 9% on a year earlier.

Public markets investment in clean energy jumped 120% to $3.1 billion, helped by the NIO flotation mentioned above but also by a $1.3-billion convertible issue from waste-to-energy specialist China Everbright International and a $311-million IPO by US fuel cell developer Bloom Energy.

Venture capital and private equity investment increased even more sharply, by 378% to $2.4 billion. VC/PE fundings of specialist clean energy companies have reached $7.5 billion in the first nine months of 2018, making this year certain to be the strongest since at least 2011. The largest six VC/PE new equity deals of 2018 so far have all involved Chinese electric vehicle firms, including the two mentioned above during 3Q.

The three biggest renewable energy asset financings in the quarter were the 860MW Triton Knoll project in UK waters at an investment cost of $2.6 billion, the Enel Green Power South Africa portfolio, at $1.4 billion for 706MW, and the Guohua Dongtai offshore wind farm phase four in Chinese waters, at an estimated $1.2 billion for 300MW.

A country split of the overall numbers shows China as yet again the largest investor in clean energy in 3Q at $26.7 billion, marginally above the numbers for the same period of 2017. However, there were further signs of one important, expected change: a cooling-off in the country’s solar installation surge, in the face of deliberate action by policy-makers. In 3Q, Chinese solar investment was $14.2 billion, down 23% on a year earlier.

Other countries and trading blocs investing in clean energy in excess of $1 billion in 3Q 2018 were:

  • Europe at $13.4 billion, up 1%
  • Germany at $1.3 billion, down 49%
  • India at $1.5 billion, up 14%
  • Japan at $4 billion, down 21%
  • Netherlands at $1.1 billion, up nearly fourfold
  • South Africa at $2.6 billion, up 90-fold, making investment in 2018 the highest for five years
  • Spain at $1.9 billion, up 11-fold, making investment in 2018 the highest since 2011
  • Turkey at $1.2 billion, up 25%
  • The UK at $2.9 billion, down 46%
  • The US at $11.4 billion, down 20% compared to 3Q 2017

Comments

Engineer-Poet

This is ridiculous.  Germany has spent over USD 200 billion on "renewables" thus far, but its grid CO2 emissions are stuck at much higher levels than the USA's and Germany has abandoned its un-attainable 2020 emissions goals.  This "investment" in the rest of the world is not going to do much, if any, better.

Measuring dollars and euros is looking at the wrong thing.  I'm sure the people making a big deal about those numbers know that.

HarveyD

This is bad news for REs in many countries.

With GHGs going up with more ICEVs, CPPs and NGPPs people will demand more REs and electrified vehicles.

D

I head something alarming today. A VP from BMW said that batteries will never fall to the value necessary to be less than ICE engines. I find this alarming that there is no path to cost effective EV's.

https://www.news.com.au/technology/innovation/motoring/motoring-news/the-reason-why-electric-cars-will-always-be-expensive/news-story/8f8d81ac872578ad665a264c91b17505

Engineer-Poet

Don't worry about it, D.  That car guy doesn't know a thing about battery chemistry.  He thinks they will all need (scarce) cobalt, and that's simply not true.  A bunch of chemistries in use today are cobalt-free.

Worse comes to worst, everything goes PHEV instead and you carry 10 kWh of battery which costs maybe $1500 instead of the $25000 he thinks it might cost.  $1500 for a 65%-80% solution is close enough for now, isn't it?

Lad

D:
All part of the campaign by oil and car companies to slow down the transition to clean energy...many of us have been fighting this for years. And, it's all the more reason people should get involved in propagating the truth and exposing the lies.
You have the power of your voice to expose the liars, your money power to buy only clean energy products, i.e., EVs; and your vote to remove the fossil fuel republicans from power. Time to quit wringing your hands and step up.

Engineer-Poet

Lad, the fossil fuel DEMOCRATS are as much or more of a power in the USA.  The daughter of "green" governor Brown of Commiefornia sits on the board of natural gas company Sempra.

TM

Germany still has a lot of coal generated electricity.
They are stuck for the moment.

David Jones

I keep hearing how Germany has missed it's goal of 40% lower emissions but the fact is that Germany has lowered emissions vis a vis 1990 levels by more than 30%, they are running a heavily industrialized nation at below 10t of CO2 per capita. That is an achievement some countries are very far from.

As for coal, the use of it has actually been dropping in the last decades. During the 90s, coal was the predominant electricity generator:

https://www.cleanenergywire.org/factsheets/germanys-energy-consumption-and-power-mix-charts

Gross power consumption portrays this very nicely. If the country had not decided to shutter nuclear plants prematurely, they would have likely been very close to their 40% target.

David Jones

The missed target has little to do with renewable energy investment failure (those investments have been quite successful in terms of developing the technology and lowering the commercial price point) and more to do with the German automobile industry obstructions, overreaction to Fukushima (existing plants should have been kept running as long as feasible with a ban on new construction of standard reactors as the phaseout) and probably to some extend the lack of infrastructure investment/development for the necessary grid upgrades.

TM

The world is moving toward clean energy.
In 100 yrs, our energy generation will be fine.
In geological time frames, 100 yrs is nothing.
It would be ironic if we miss the tipping point by a mere 100 yrs and doom us all.
Let us hope we haven't just missed it by 100 yrs.
Remember the opposite as well - what if we were to have 5000 ft tall glaciers occupying all of canada down to Iowa for 1,000,000 yrs.
That would be hard to deal with too.

Engineer-Poet
the fact is that Germany has lowered emissions vis a vis 1990 levels by more than 30%
This was almost entirely due to closing the inefficient Soviet-era industry in E. Germany.  Progress has stagnated under the "Energiewende", which has wended its way back to filthy, destructive coal.
they are running a heavily industrialized nation at below 10t of CO2 per capita.
France is way ahead of Germany.
If the country had not decided to shutter nuclear plants prematurely
Protecting coal interests is the whole point.
HarveyD

Fossil fuels (coal, Oil and NG) workers and farmers have very strong lobbies and are excessively important, specially in democracies during election years.

To reduce pollution and GHGs we may have to travel less, eat less, be more selective in what we eat, reduce waste and costly demonstrations.

New GREE** heat pumps with SEER 33+ effective to -30C are great to reduce NG-Oil and Electricity used for heating while reducing pollution and GHGs.

Of course, better building codes, would also do a lot to reduce pollution and GHGs while reducing damages during severe storms.

China** creates less pollution and GHGs per capita than USA and/or Germany and many other industrial countries..

Arnold

Harvey,
Just as long as we don't have to bonk less - well the superstitious ones anyway - the rest can use birth control.

HarveyD

Sooner or latter we will have to admit that people living in USA, Canada, NZ, Australia and a few countries in EU and Asia consume and pollute too much and are responsible for climate changes and progressive destruction of the environment. There are many better ways.

Our badly designed and constructed houses cannot resist many of the new-recent storms, specially within 100 Km from ocean shores. By exception, my sister's house on the East coast of Florida has gone through 10+ storms during the last 40+ years without any damages. The super heavy, huge thick roof concrete tiles never moved and windows/doors are well protected with appropriate shutters. On the other hand, they are still driving a huge V-8 polluting Cadillac.

HarveyD

Too bad that large NPPs cost have run out of control.

The new EDF NPP in Flamanville-Normandy will cost over $14B or $15B instead of $3.7B and will not be in operation till 2023 due to long multiple delays since starting date (2007). Not too many countries or private industries can afford similar extended delays and high cost.

Even China is reducing implementation of its nuclear program in favour of safer, quicker Solar and Wind REs.

Engineer-Poet

China's imperative right now is clean air.  There is lower-hanging fruit than electric generation.

China is embarking on a build-out of swimming-pool nuclear reactors for district heating.  It is a faster road to elimination of air pollution from coal combustion.  2 year build time for 400 MW(th).

400 MW(th) is about 6900 tons of water per hour heated from 40°C to 90°C.  The coal-fired stoves it will be replacing are eerily similar to the ones used in England at the time of the deadly London smogs.  They are much dirtier than power plants and almost impossible to clean up.

If a dwelling requires a nominal 15,000 BTU/hr of heat, one 400 MW(th) reactor will heat around 90,000 dwellings.  As it uses unpressurized coolant it is meltdown-proof.  If you are trying to make a big difference in people's lives in a hurry to maintain your political legitimacy (the Mandate of Heaven), this is definitely a high priority.

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