Germany invested €26.6 billion (US$34.6 billion) in renewable energy projects in 2010, according to a new report by Climate Policy Initiative (CPI).

The report, The German Landscape of Climate Finance, provides a review of how German businesses, households and government finance renewable energy and energy efficiency.

Of the €26.6 billion figure, almost €20 billion or 75% was invested in small-scale renewable energy projects including residential solar PV installations. The remaining 25% was used to fund large-scale renewable energy projects.

The renewable energy figure forms part of a larger €37 billion figure quoted in the report which represents the total amount that Germany spent on measures to reduce its impact on climate change in 2010. 

As part of its climate mitigation efforts, Germany also injected €7.2 billion into energy efficiency investments whilst €3.3 billion was allocated to other climate specific investments.

In terms of financial providers, €22 billion was funded by corporate investors across all sectors of the economy, including farmers, energy utilities, and industrial and commercial enterprises. Private households, meanwhile, invested €14 billion.

Furthermore, CPI highlighted that government incentives played a crucial role in private climate investment. According to the report, nearly half of all private climate investments, around €16.5 billion, were supported by low-interest loans from public banks such as KfW and Rentenbank.

"The task of the government is to create the conditions for businesses and households to invest in renewable energy and energy efficiency. And indeed, government-backed low-interest loans and policies such as the feed-in-tariff seem to have played an important role in encouraging these private investments," said Barbara Buchner, Director, CPI Europe.

Ingmar Juergens, Associate Director of CPI Berlin added: "If we want Germany's energy transition to be a success, and if we want other countries to learn from the German experience, we need a better understanding of current finance flows and the impact of policies on encouraging investments."