Clean energy investment leaps

By Gerard Wynn

LONDON (Reuters) - Global investment in clean energy and climate-friendly technologies leapt in the last three months but full-year levels won't recover until 2010 or 2011, analysts said on Wednesday.

Falling energy demand and more expensive debt have hurt large renewable projects for example in wind and solar power. Recession has cut risk appetite, curbing funding for clean technology start-ups.

But global clean energy investment rebounded in the past three months, after a 44 percent collapse in the first quarter, and stimulus spending could spur a return to last year's funding levels in 2010, according to research group New Energy Finance.

"It's a big bounce back," said Michael Liebreich, NEF chief executive, referring to preliminary numbers to be published later this week or next.

"We've lost two years," he added, comparing similar figures in the second quarters of 2009 and 2007.

In addition to stimulus spending, bright spots for the sector included some return to bank lending, easing on margins above interest rates, a proposed U.S. climate bill and falling costs of components including solar-grade silicon and steel for wind turbines. Concerns include fears of a drawn out recession.

In rough calculations, Liebreich expected $62 billion (38 billion pound) stimulus funding for clean energy in 2010 in addition to about $90 billion from capital markets to return the sector to 2008 investment levels of $155 billion, or to beat that.

Governments worldwide plan to spend about $3 trillion in programmes to boost flagging economies and a portion of that on green measures.