With the continued increase in renewable energy use across the United States and Europe solar power outperforms wind power in terms of returns on investments on a global scale, according to a recent report from Fitch Ratings. This was Fitch’s first global review of the energy sector and Andrew Joynt, Director at Fitch Ratings, stated that “Solar projects are demonstrating lower operational risk, better generation performance and lower volatility.”
While the agency also noted that renewable revenues continue to be “inherently volatile”, the performance for assets related to solar power have continued to be more consistent compared to wind power.
Currently most of wind power projects are found in Lating America. Brazil alone contains 19 out of the 41 wind projects that Firch rated. On the other hand, 9 out of the 16 solar energy projects that were rated by Fitch were found in the United States, primarily in California.
Joynt did point out though that, “Over time, however, there are likely to be more solar projects out of Brazil, while offshore wind projects may proliferate in Europe and the U.S.”
“Solar projects also tend to meet or exceed initial volume estimates while wind projects more often underperform against expectations.” also stated Mr. Joynt.
Fitch has upgraded 19% of its rated solar projects, in comparison to only 1% for for wind projects, as well as downgraded 12% of the wind projects. The wind project downgrades were all put into effect due to underperformance.