Global investment in clean energy hit a record $260 billion in 2011, up 5 percent from the previous year as investment in solar grew by more than a third despite shrinking profit margins, some bankruptcies and flagging share prices, a report said.
The United States last year regained its title as the top country for clean energy investment, beating out China for the first time since 2008, said a report by Bloomberg New Energy Finance (BNEF) on Thursday.
Global clean energy growth was driven mainly by solar, for which investment grew by 36 percent to $136.6 billion, as a 50 percent drop in prices for photovoltaic panels spurred installation.
Solar investment was double that of wind power, which fell 17 percent to $74.9 billion, the report said.
Remember that for every equipment company operating at thin or negative margins, there is an installer who is getting a good deal, said Michael Liebreich, chief executive of BNEF said in a statement.
He added: Rumors of the death of clean energy have been greatly exaggerated.
Last year was bleak for some, however. Many solar stocks retreated by more than 60 percent as the prices for panels that convert sunlight into electricity fell sharply, erasing profit margins for manufacturers.
A number of companies have already lost their fight for survival, such as Germany's Solon SE
U.S. company Evergreen Solar Inc filed for bankruptcy on Monday, its once cutting-edge technology falling victim to competition from cheaper Chinese rivals and cuts in solar subsidies in Europe.
Clean energy investments in the United States rose by 33 percent to nearly $56 billion, while those in China edged up 1 percent to $47.4 billion.
The U.S. figure last year was boosted mainly by a federal loan guarantee programme and a Treasury grant programme, which have now expired, Liebreich said.
He said the country's remaining support measure for renewable energy, the Production Tax Credit, could also fall away at the end of 2012 unless it gets an extension.
There may be a rush to get projects completed in 2012, followed by a slump in investment in 2013 if it expires, he said.
Elsewhere, clean energy investment in Europe rose 3 percent to around $100 billion, in India jumped 52 percent to $10.3 billion and in Brazil increased 15 percent to $8.2 billion.
Among investment types, utility-scale renewable energy projects led the way, increasing to $145.6 billion in 2011 from $138.3 billion the previous year.
Some of the big projects financed in the last quarter of the year were a 288 megawatt (MW) offshore wind farm off Germany for $1.3 billion, a 272 MW wind farm in Canada for $756 million and solar thermal plant in China for $354 million.
The finance of distributed renewable technology, notably rooftop solar panels, rose by 22 percent to $73.8 billion, with Italy and Germany playing the biggest role.
Fund-raising in public markets and investment in government and corporate research and development all fell last year.
Among some of the smaller renewable energy sectors, investment in biofuels edged up 4.6 percent to $9 billion, geothermal slipped nearly 12.5 percent to $2.8 billion and small hydro fell 25 percent to $3 billion.
(Reporting by Jeff Coelho, editing by Jane Baird)