Renewable-energy funds suffered record outflows this year, reversing their direction from 2009, as money managers including BlackRock Inc said the credit crunch dimmed the outlook for solar and wind power projects.
Investors pulled 931 million euros ($1.2 billion) in the first 10 months, already eclipsing the full-year withdrawals in 2008 when the global financial crisis spooked investors, according to data compiled by Lipper Inc. Last year clean-energy funds captured 1.3 billion euros of new money, Lipper said.
Tighter loan terms for clean-power projects, greater competition from Chinese manufacturers and reduced subsidies from European governments hammered some of the stocks that had been favourites of fund managers before 2010, such as Vestas Wind Systems A/S, the world’s largest wind-turbine maker. Funds that held oil and gas companies were gainers, a separate survey said.
“The new-energy market and related stocks were significantly impacted by the credit crisis,” Robin Batchelor, manager of the $2.9 billion BlackRock New Energy Fund, said in an e-mail. Reduced demand for energy and “the fact that governments were perceived to have many new worries on their agenda combined to create a difficult environment,” he said. New York-based BlackRock is the world’s largest money manager.
Conventional energy stocks saw the biggest increase in holdings and were the largest bets for funds, according to a Bank of America Merrill Lynch survey of 209 money managers controlling $569 billion, conducted December 3 to December 9. The clean-energy sell-off is a blow to policymakers in the US, Japan and the European Union who pledged last year in Copenhagen to ramp up investment as they channel $100 billion a year in climate aid to developing nations by 2020.