By Will Nichols, Source: BusinessGreen

A fourth quarter rally was not enough to stop global clean energy investment dipping for the first time since records began, according to preliminary figures from analyst firm Clean Energy Pipeline.

The company’s latest quarterly report finds global investment in the sector bounced back to just under $68bn in the last three months of 2012, a 19 per cent increase on the previous quarter, when investment dropped to the lowest levels seen since 2009.

Project and asset finance accounted for $42bn of investment activity in the fourth quarter of the year, underpinned by a surge in US wind developers racing to complete deals ahead of the potential expiry of a production tax credit at the end of the year. The performance marked a 39 per cent increase on the third quarter and an improvement of almost a fifth on the same period in 2011.

Merger and acquisition activity also spiked in the fourth quarter, climbing 16 per cent during the quarter to over $18bn, resulting in a year-on-year increase of 38 per cent.

But the sector’s positive end to the year could not disguise the fact that, as expected, 2012 marked a drop in total global investment for the first time.

Douglas Lloyd, chief executive of Clean Energy Pipeline, said that while the $256bn invested last year was 14 per cent down on the record $293bn racked up in 2011 the results were still encouraging.

“Annual volumes couldn’t keep increasing inexorably given low gas prices in the US, ongoing policy uncertainty, and weak global capital markets,” Lloyd said in a statement. “However, the decline should be put in perspective. The $68bn invested in the fourth quarter of 2012 was more than double the $33bn invested throughout 2004.”

Venture capital and private equity investment also fell, the fifth consecutive quarter it has done so, dropping to $1.6bn, 36 per cent down on the corresponding period in 2011.

Meanwhile, clean energy companies continued to baulk at IPOs during 2012, among them solar firm BrightSource Energy and Smith Electric Vehicles. This resulted in a record low of $162m secured on the public markets – a figure substantially improved by SolarCity’s $95m IPO in December.