Greenfield FDI projects in the renewable energy sector hit their highest level since 2008 in 2018, with 364 projects recorded globally and a cumulative capital investment of $82.4bn, fDi Intelligence reports.   

In August 2017, the Trump administration in the US announced its intention to withdraw from the UN’s Paris Agreement, and it was in this year that the number of US greenfield FDI projects in the renewable energy sector dropped by 42%. Conversely, neighbouring Mexico saw a 29% increase in such projects to 27 in that year.


Following the drop in 2017, the US was the top destination for renewable projects in 2018, attracting 36 such projects and ranking second globally with $6.7bn in announced FDI, according to figures released in The fDi Report 2018.  

Other countries emerging as leading destinations for renewable energy projects include Spain, which had no announced projects in 2015 and attracted 23 in 2018, and Vietnam, which achieved 283% growth from its 2015 performance. Russia, the Netherlands and Taiwan also show a marked increase in the number of projects attracted, seeing 10, nine and eight projects respectively in 2018. The top destinations for FDI by capital investment were Indonesia, the US, Taiwan, the Netherlands and the UK.

Indonesia topped the destination country table for capital investment, attracting a total of $19.97bn with $17.9bn of the total attributable to China-based Sinohydro’s announcement that it would develop five hydropower facilities in North Kalimantan. Taiwan ranked third in this table, largely through Japan-based Marubeni’s plan to build a $3.78bn wind farm off the coast of Changhua County.

Despite a hydropower project being the most capital-intensive project of 2018, the subsector only made up 2.57% of the total number of FDI projects in the sector. Solar and wind power projects have consistently made up the bulk of projects in the sector since 2014, and while the number of solar projects has remained relatively consistent, wind power hit an all-time high in 2018 with 113 projects, a 69% increase on 2017.

A total of $27.2bn was invested in wind electric power, accounting for one-third of global capital investment in the renewable energy sector and showing a 101.4% increase on 2017. This was closely followed by solar electric power projects, which accounted for 30.73% and $25.3bn of the global total.

Biomass power has shown significant growth in the number of projects in recent years as the rate of technological development around the process gathers pace. Unlike solar and wind power projects, which are geographically restricted, biomass power facilities are likely to emerge as a generation project of choice for countries without profitable options for solar or wind projects.

As the renewable energy sector continues to develop globally, it is likely that growth in the number and value of biomass power projects will contribute to this trend further, the report concludes.

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