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WindEurope has published its annual Finance and Investment Trends report. Europe invested €41.4bn in new wind farms in 2021. This is 11% less than 2020. But the investments cover 24.6 GW of new capacity, which is a record for new capacity financed in a single year.
Most of the new wind farms financed were onshore - 19.8 GW. Which partly explains why the amounts invested were down compared to 2020: onshore wind is cheaper than offshore.
The investments were pretty well spread geographically. Eleven countries invested more than €1bn. The UK invested the most (almost all in offshore wind) followed by Germany, France, Spain, Sweden and Finland. Spain invested the most in onshore wind. Sweden, Finland, Poland and Lithuania all invested more in new farms than they had done in any previous year.
A growing number of new wind investments are underpinned by contracts for difference (CfDs) that governments are offering in their renewables auctions. CfDs deliver stable revenues for project developers at low costs to Governments - because Governments only pay out when the electricity price is below the auction price but get paid back when it’s higher. CfDs also reduce finance costs because the clear revenue perspective means banks finance projects at favourable rates of interest.
2021 was a record year for corporate renewable Power Purchase Agreements (PPAs). 6.9 GW of new PPA deals were announced, raising the total amount of renewables under PPA by a 58% in one year alone to 18.8 GW. Wind was 60% of the new PPA capacity with 41 new PPAs for onshore wind farms and 11 for offshore wind farms.
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