LONDON - U.S. and China markets are driving recovery in the global clean energy industry, after a sharp fall in investment this year, but uncertainty over government support is clouding the 2010 outlook.

"There are many uncertainties for 2010 but prices seem to be stabilizing in this half," Aleo Solar Chief Financial Officer Uwe Boegershausen told a Jefferies cleantech conference in London.

He sees opportunities for the United States and China but acknowledges that the German election could mean cuts to solar electricity price support -- called feed-in tariffs -- in the world's biggest solar market.

"The new government is definitely more supportive of nuclear and there are clear signals they will adjust the feed-in tariff," he said.

Analysts said the main risk for the solar industry was a price war, sparked by Chinese producers such as Yingli Green Energy, obliterating the margins of higher-cost German producers.

"The optimistic part is that European pricing is holding up," said Jefferies analyst Michael McNamara, adding that some European producers were comfortably selling out through 2009 at 2 euros ($2.91) per watt peak or more, compared with some Chinese company plans for a year-end price of 1.3 euros.

"The cautious part is that there is no price visibility for 2010," he added.

The United States and China also offer opportunities for wind energy, the most mature market of the renewables sector.

Iberdrola Renovables, the world's biggest operator of wind power assets, said it will spend more than half all its capital expenditure through 2012 developing its U.S. business.

China will be the world's biggest wind market this year, with 10 gigawatts (GW) new installed power, followed by Europe and the United States, said Bernard Schaeferbarthold, chief financial officer of turbine manufacturer Nordex AG.

The emerging British offshore wind market will also be a big opportunity from 2013 -- "We want to be there, it will be the next phase in developing wind energy, Iberdrola Renovables Chief Financial Officer Jose Angel Marra told Reuters.

McNamara said threats to the sector generally centered on long-term incentives, such as a possible "paralysis" of a U.S. bill which aims to cut greenhouse gas emissions by 20 percent by 2020 from 2005 levels.

"In the United States we're seeing lots of signs things are picking up but not big turbine orders yet," he added.

Source: Reuters

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