Wind-power companies seem to have run out of steam, as they are losing their attraction for venture backers.

 

There was a decline of 38 percent to $9.7 billion last year in US investments in turbine farms and wind-energy businesses, as venture capitalists seem to have completely abandoned this sector. Their investment last year was down 71 percent from the year before to $177.6 million.

 

Backing for clean energy has been increasing with massive investments in the sector. In 2011, venture backers invested $4.29 billion in the sector, up 13 percent from the previous year. However, wind power projects need large outlay of cash and investors find it hard to afford the same.

 

It is estimated that there will be a drop of 14 percent this year from 2010 in global purchases of turbines, as there is not enough demand and there is a glut of turbine production due to investments over the past five years in the US, Europe and Asia. It is also expected that global purchases will not go past the 2011 levels for two years.

 

Turbine makers are feeling the pinch of the decline in demand with Vestas Wind Systems in the Netherlands and Suzlon Energy in India reporting greater-than-expected losses last month. The stocks of the companies have plunged in the past year.

 

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