Report: Global Cleantech Investment Down 22% in 3Q

New global investment in clean-energy companies fell 22 percent in the third quarter as government financing was offset by tight credit markets, according to new research released Friday.

From July to September, new global investment totaled $25.9 billion, down 22 percent from a year ago and off 9 percent from the second quarter, according to London-based New Energy Finance, a global research firm.

But the sector appears to be heading toward a recovery, with investment nearly double what it was in the first quarter and investors growing more confident.

Many analysts think a turnaround will come in 2010 but caution that much depends on the U.S. economy, the health of the financial sector, natural gas prices and even electricity demand.

Asset financing, a key measure for solar and wind projects, fell 26 percent to $19.2 billion. Venture capital and private equity investment dropped 46 percent to $2.2 billion.

The third-quarter total, however, was nearly double the $13.3 billion recorded in the first quarter, said Ethan Zindler, who heads New Energy's North American research arm.

"Activity has certainly bounced off of Q1 (the first quarter), which was just when things came to a grinding halt," he said.

"I think the market has recognized that this industry is getting substantially more support from the federal government and other governments around the world," he said. "I think that helps bolster confidence as well."

Global public market financing rose 45 percent to $4.5 billion, yet shares of some companies still lag last year's value.

For example, shares of solar-power module maker First Solar Inc. closed Thursday at $143.76, down about 24 percent from Sept. 30, 2008, and solar technology company SunPower Corp. closed at $28.47, down nearly 60 percent.

Renewable energy is a small fraction of all power used but has gained favor globally as governments and businesses seek to curb pollution and the use of fossil fuels.