EconPapers    
Economics at your fingertips  
 

Financing renewable energy: Who is financing what and why it matters

Mariana Mazzucato () and Gregor Semieniuk

Technological Forecasting and Social Change, 2018, vol. 127, issue C, 8-22

Abstract: Successful financing of innovation in renewable energy (RE) requires a better understanding of the relationship between different types of finance and their willingness to invest in RE. We study the ‘direction’ of innovation that financial actors create. Focusing on the deployment phase of innovation, we use Bloomberg New Energy Finance (BNEF) data to construct a global dataset of RE asset finance flows from 2004 to 2014. We analyze the asset portfolios of different RE technologies financed by different financial actors according to their size, skew and level of risk. We use entropy-based indices to measure skew, and construct a heuristic index of risk that varies with the technology, time, and country of investment to measure risk. We start by comparing the behavior of private and public types of finance and then disaggregate further along 11 different financial actors (e.g. private banks, public banks, and utilities) and 11 types of RE technologies that are invested in (e.g. different kinds of power generation from solar radiation, wind or biomass). Financial actors vary considerably in the composition of their investment portfolio, creating directions towards particular technologies. Public financial actors invest in portfolios with higher risk technologies, also creating a direction; they also increased their share in total investment dramatically over time. We use these preliminary results to formulate new research questions about how finance affects the directionality of innovation, and the implications for RE policies.

Keywords: Renewable energy finance; Financial actors; Portfolio approach; Direction of innovation; Deployment; Technology risk (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (57) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0040162517306820
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Financing Renewable Energy: Who is Financing What and Why it Matters (2016) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:tefoso:v:127:y:2018:i:c:p:8-22

DOI: 10.1016/j.techfore.2017.05.021

Access Statistics for this article

Technological Forecasting and Social Change is currently edited by Fred Phillips

More articles in Technological Forecasting and Social Change from Elsevier
Bibliographic data for series maintained by Nithya Sathishkumar ().

 
Page updated 2021-03-28
Handle: RePEc:eee:tefoso:v:127:y:2018:i:c:p:8-22