Banks reluctance to finance new projects will not impede the recovery of European wind power sector from recession as investments are pouring from other sources like infrastructure funds and power companies.
The European Wind Energy Association (EWEA) said at the opening ceremony of its annual conference on March 16, 2009 that the wind energy sector would be the fastest recovering industry from recession due to its least dependence on bank loans compared to other industries, as reported by euractiv.
According to EWEA, European companies account for two-third of wind power technologies installed across the world with total value of €35 Billion. Further, the wind energy sector is likely to generate more than one third of total electricity from renewable sources by 2020. The EU executive has said that the power generation from wind is rapidly increasing, with over 40% of electricity generation capacity installed in 2007 powered by wind. In view of stupendous growth, EWEA has revised its projection for installed wind generating capacity from 180 to 230 Gigawatts by 2020.
While banks showing less inclination to finance projects, the European wind energy sector will clock in staggering growth on account of infrastructure funds and huge investments from institutional investors. Financially strong power companies will also play critical role in rising wind power generation capacity in Europe.
A European wind power lobby states that the economic meltdown has undoubtedly delayed some wind power projects in the EU, but the situation will soon change due to strong sector fundamentals.
The long term growth prospects of the industry are very bright with European Union’s last year decision of generating one fifth of total power from renewable resources such as sun and wind. The decision is made in view of looming threat of climate change, rising accumulation of green house gases and to reduce dependence on imports of oil and gas.
According to a Research Analyst at RNCOS, “Although several industrial sectors are facing low demand for their products, the European wind power sector continues to expand its share in the power industry. Bright growth prospects have attracted new sources of finance, but the EU government should provide investment friendly environment by giving loan guarantees to renewable resources. All investment channels including export credits and bank lending need to be opened to enable the industry meet the rising power demand.”
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