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    Spanish company Ferry Group is to invest €42/US$55.2 million in a project for the production of biomass fuel pellets in Bulgaria. The 3-year project consists of establishing plantations of paulownia trees near the city of Tran. Paulownia is a fast-growing tree used for the commercial production of fuel pellets. Dnevnik - Feb. 20, 2007.

    Hungary's BHD Hõerõmû Zrt. is to build a 35 billion Forint (€138/US$182 million) commercial biomass-fired power plant with a maximum output of 49.9 MW in Szerencs (northeast Hungary). Portfolio.hu - Feb. 20, 2007.

    Tonight at 9pm, BBC Two will be showing a program on geo-engineering techniques to 'save' the planet from global warming. Five of the world's top scientists propose five radical scientific inventions which could stop climate change dead in its tracks. The ideas include: a giant sunshade in space to filter out the sun's rays and help cool us down; forests of artificial trees that would breath in carbon dioxide and stop the green house effect and a fleet futuristic yachts that will shoot salt water into the clouds thickening them and cooling the planet. BBC News - Feb. 19, 2007.

    Archer Daniels Midland, the largest U.S. ethanol producer, is planning to open a biodiesel plant in Indonesia with Wilmar International Ltd. this year and a wholly owned biodiesel plant in Brazil before July, the Wall Street Journal reported on Thursday. The Brazil plant is expected to be the nation's largest, the paper said. Worldwide, the company projects a fourfold rise in biodiesel production over the next five years. ADM was not immediately available to comment. Reuters - Feb. 16, 2007.

    Finnish engineering firm Pöyry Oyj has been awarded contracts by San Carlos Bioenergy Inc. to provide services for the first bioethanol plant in the Philippines. The aggregate contract value is EUR 10 million. The plant is to be build in the Province of San Carlos on the north-eastern tip of Negros Island. The plant is expected to deliver 120,000 liters/day of bioethanol and 4 MW of excess power to the grid. Kauppalehti Online - Feb. 15, 2007.

    In order to reduce fuel costs, a Mukono-based flower farm which exports to Europe, is building its own biodiesel plant, based on using Jatropha curcas seeds. It estimates the fuel will cut production costs by up to 20%. New Vision (Kampala, Uganda) - Feb. 12, 2007.

    The Tokyo Metropolitan Government has decided to use 10% biodiesel in its fleet of public buses. The world's largest city is served by the Toei Bus System, which is used by some 570,000 people daily. Digital World Tokyo - Feb. 12, 2007.

    Fearing lack of electricity supply in South Africa and a price tag on CO2, WSP Group SA is investing in a biomass power plant that will replace coal in the Letaba Citrus juicing plant which is located in Tzaneen. Mining Weekly - Feb. 8, 2007.

    In what it calls an important addition to its global R&D capabilities, Archer Daniels Midland (ADM) is to build a new bioenergy research center in Hamburg, Germany. World Grain - Feb. 5, 2007.

    EthaBlog's Henrique Oliveira interviews leading Brazilian biofuels consultant Marcelo Coelho who offers insights into the (foreign) investment dynamics in the sector, the history of Brazilian ethanol and the relationship between oil price trends and biofuels. EthaBlog - Feb. 2, 2007.

    The government of Taiwan has announced its renewable energy target: 12% of all energy should come from renewables by 2020. The plan is expected to revitalise Taiwan's agricultural sector and to boost its nascent biomass industry. China Post - Feb. 2, 2007.

    Production at Cantarell, the world's second biggest oil field, declined by 500,000 barrels or 25% last year. This virtual collapse is unfolding much faster than projections from Mexico's state-run oil giant Petroleos Mexicanos. Wall Street Journal - Jan. 30, 2007.

    Dubai-based and AIM listed Teejori Ltd. has entered into an agreement to invest €6 million to acquire a 16.7% interest in Bekon, which developed two proprietary technologies enabling dry-fermentation of biomass. Both technologies allow it to design, establish and operate biogas plants in a highly efficient way. Dry-Fermentation offers significant advantages to the existing widely used wet fermentation process of converting biomass to biogas. Ame Info - Jan. 22, 2007.

    Hindustan Petroleum Corporation Limited is to build a biofuel production plant in the tribal belt of Banswara, Rajasthan, India. The petroleum company has acquired 20,000 hectares of low value land in the district, which it plans to commit to growing jatropha and other biofuel crops. The company's chairman said HPCL was also looking for similar wasteland in the state of Chhattisgarh. Zee News - Jan. 15, 2007.

    The Zimbabwean national police begins planting jatropha for a pilot project that must result in a daily production of 1000 liters of biodiesel. The Herald (Harare), Via AllAfrica - Jan. 12, 2007.

    In order to meet its Kyoto obligations and to cut dependence on oil, Japan has started importing biofuels from Brazil and elsewhere. And even though the country has limited local bioenergy potential, its Agriculture Ministry will begin a search for natural resources, including farm products and their residues, that can be used to make biofuels in Japan. To this end, studies will be conducted at 900 locations nationwide over a three-year period. The Japan Times - Jan. 12, 2007.

    Chrysler's chief economist Van Jolissaint has launched an arrogant attack on "quasi-hysterical Europeans" and their attitudes to global warming, calling the Stern Review 'dubious'. The remarks illustrate the yawning gap between opinions on climate change among Europeans and Americans, but they also strengthen the view that announcements by US car makers and legislators about the development of green vehicles are nothing more than window dressing. Today, the EU announced its comprehensive energy policy for the 21st century, with climate change at the center of it. BBC News - Jan. 10, 2007.

    The new Canadian government is investing $840,000 into BioMatera Inc. a biotech company that develops industrial biopolymers (such as PHA) that have wide-scale applications in the plastics, farmaceutical and cosmetics industries. Plant-based biopolymers such as PHA are biodegradable and renewable. Government of Canada - Jan. 9, 2007.

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Wednesday, December 20, 2006

Investments in renewables top $100 billion in 2006

We're nearing the end of the year, and it's been a busy one for us. Since going online, we have been reporting on quite a number of projects and investments in the bioenergy sector in the developing world. But now it's time to get a more global overview. How much money did the green energy sector as a whole attract this year? Which countries and sectors were most active? And what does next year have in store? New Energy Finance helps us find out.

According to this specialist provider of financial information and research on investment in the sector, clean energy and low-carbon technology industries are on course to set a new record [*.pdf] of more than $100bn worth of financing transactions over the course of 2006. Bioenergy and biofuels were by far the fastest growing sectors, attracting ten times more money in 2006 than in the previous year.

It is estimated that total deal volume for the full year will be around $100bn. Of this, $70.9bn will be new investment, an increase of 43% on 2005, while $29.5bn will consist of M&A activity, leveraged buyouts and refinancings of assets.

The biggest growth has been in public markets and venture capital/private equity investment activity, which increased by 141% and 167%, respectively. Asset financings grew at a more sedate 22.9%. Public market fund-raisings for clean energy companies will breach the $10bn mark for the first time in 2006, reaching $10.3bn, up from $4.3bn in 2005 and $0.7bn in 2004.

Interest in clean energy-related IPOs was exceptionally strong in the first four months of the year, following President George W Bush’s “Addicted to Oil” remarks in his State of the Union Speech. This fell away following the market correction in May, only to return during Q4, to coincide with the publication of the Stern Review, which highlighted the relative economic returns from acting to prevent climate change, and the US elections, which signalled a change of heart towards the sector.

Going into the final week of the year, the WilderHill New Energy Global Innovation Index (NEX), the quoted index which charts the value of more than 80 of the world’s leading quoted clean energy companies, is up more than 30% on the start of the year:
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Qua volume, the leading sector of the industry for investment on the public markets during 2006 was solar, attracting $4.4bn – more than double the $1.7bn in 2005.
Biofuels and bioenergy were the fastest growing sector with $2.5bn, which was more than 10 times the amount raised in 2005. Wind was relatively static, raising just $1.2bn worldwide on the public markets, against $1.1bn in 2005.

Specialist carbon market service providers, such as brokers and carbon fund managers, were the big losers in terms of public market fundings, raising only $67m in 2006, compared with $465m in 2005. Reasons range from the crash in the European carbon prices in April to the limited time before the Kyoto Protocol falls away in 2012 and the entry of large commodity and banking players into the market. Despite the lack of interest among public equity investors, the volume of money in specialist carbon funds powered ahead during the year, reaching more than $7bn by year end.

The hottest geographical market of the year was Frankfurt, where a total of 15 clean energy deals raised $2.6bn, including the $1.5bn IPO of Wacker Chemie, one of the global leaders in the production of solar silicon, a bottleneck commodity. NASDAQ registered 21 deals and $1.7bn in funds raised, while London’s AIM remained the favourite among smaller companies, attracting 29 clean energy deals worth a total of $1.2bn.

New Energy Finance has identified a healthy pipeline of IPOs for early 2007, with a record number of companies having filed registration papers or in discussions with advisors, suggesting that momentum will be strong into the New Year. Biofuels, solar and wind companies look set to continue to dominate the volume.

Venture capital and private equity investment looks set to top $7.0bn for the full year 2006, an impressive 167% increase on 2005. Growth was concentrated in private equity for expansion which soared in 2006 to $2.6bn, almost triple the $874m seen in 2005, with the cash mainly flowing into biofuels capacity.

There was significant growth in later stage venture capital deals, particularly series C, as investors chased exceptional returns. Over-the-counter and private investment in public equity (PIPE) deals showed similar growth. Early stage venture capital investment, including seed and Series A and B deals remained weak, however.


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