Renewable projects in developing world offer 28% more returns than Europe and US

By Editor


IRRs (internal rates of return) for renewable energy projects in the developing world are 28 percent higher than those in Europe and North America, according to Mercatus, a solutions developer.

Investment in advanced energy in emerging markets matched that of developed countries for the first time in 2015.

Advanced energy projects were bigger on average in emerging countries than in North American and European markets.

The type of growth in emerging markets differed from that in developed regions, presenting more opportunities for utility-scale projects than North America and Europe.

In South America, the average project size was 64MWdc (megawatts direct current), while Africa averaged 45MWdc and the Middle East averaged 34MWdc.

Average project sizes in Europe (3MWdc) and North America (11MWdc) were distinctly smaller, according to the report.

With $12 trillion flooding into the market, the energy sector is starting transformation. Most of the growth is in developing regions.

“Low oil prices have actually created an opportunity for our company,” said Sanjeev Kumar, senior vice president of project development at GlassPoint Solar. “When oil was $100 a barrel, oil and gas companies had no incentive to save on costs; they were focused on extracting as much oil as possible.”

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