The United Nations Environment Program has just published a report about the world’s investments in renewable energy last year. The big picture: investments are up by 32%, to $211 billion, mostly driven by China’s wind energy spending and rooftop solar projects in Europe. You can read more about the figures at UNEP’s website.

One particularly interesting chapter covers spending on research and development, which jumped by 41% to hit $8.6 billion last year. Corporate (private sector) spending in this area has actually gone down. But thanks to the ‘green stimulus’ packages announced in the throes of the financial crisis, government (public sector) support for renewables R&D has soared. State support has now overtaken company spending for the first time, the report says (see chart).



The report is based on figures collated by Bloomberg New Energy Finance (BNEF), who have tracked the ‘green stimulus’ spending over time. Originally, $26.8 billion of a total $194 billion announced in 2008-09 was earmarked for research and development, says BNEF analyst Anna Czajkowska. By the end of 2010, around half of the stimulus funds were spent, $17.6 billion of that on R&D*.

With half the green stimulus funding still to come – and almost $10 billion of that earmarked for R&D – “2011 should prove another strong year, particularly if there is any recovery in corporate investment”, the report says. But there are caveats.

First, much of the stimulus funding earmarked for R&D has actually been spent in other ways, such as improving electricity grids, energy efficiency schemes or renewable energy projects. In particular, most of China’s money supposedly bound for R&D has ended up financing construction projects.

Second, BNEF says “measures amounting to some $18 billion of the initial stimulus total seem to have ‘disappeared’: there is simply no evidence that they are on course to turn into actual spending”. [The ‘missing’ measures were not earmarked for R&D, Czajkowska adds].

Third, of course, even $8.6 billion spent on R&D is far short of estimates of what’s needed.

*including R&D on energy-smart technologies, not included in the UNEP report as it restricts itself to renewable energy spending.