Skyrocketing oil prices and a greater attention to the problems created by greenhouse gases has helped the renewable energy market in Europe to boom over the last decade. Thanks to strict government regulations in Germany and lofty goals for cutting carbon emissions across the EU, solar and wind technologies have seen over a decade of innovation and created a new, profitable market.

According to the market research company New Energy Finance, 2007 saw worldwide investments in clean energy climb to $148 billion (118.2 billion euros).

Now with banks' money woes seeping into nearly every industry, some say that investors' love affair with renewable energies may be ending and Germany's place as an industry leader is threatened.

"There are presently enormous difficulties with financing," Fritz Vahrenholt, CEO of the German utility RWE Innogy told Greentech conference-goers in Berlin this week.

"There are large German banks where, at the moment, every 10 million-euro credit line has to be approved by the board of directors," said Deputy Environment Minister Matthias Machnig.

Concerned about a potential shift in investor sentiment, the German environment ministry is expected to invite the heads of banks, the electricity industry and the renewable energy sector to a meeting later this year.

Dire times or smooth sailing ahead?

The move comes amid speculation that the US investment group Blackstone may back out of the billion-euro windpark project "Meerwind" near Helgoland.

Hamburg windmill producer Repower likewise said that threats of order cancellations have reduced their expectations for the coming year. Sales growth estimates there have decreased from between 40 and 50 percent to between 30 and 35 percent.

Despite the dire sentiments of some, forecasts for the energy production market remain strong in the short-term. The World Energy Outlook 2008, a report released by the International Energy Agency (IEA) on Nov.12, 2008 shows the renewable sector growing rapidly, overtaking gas to become the second-largest source of electricity soon after 2010.

The crisis likewise isn't expected to impact those projects already in the works. Many projects, such as Alfa Ventus, Germany's first offshore wind farm currently under construction in the North Sea, already have secure funding.

The pilot project, which has 12 turbines being set up north of the island of Borkum, can create enough energy to power over 50,000 German households, all carbon emissions free.

"This won't be affected by the financial crisis at all," said Lutz Wiese, spokesperson for Vattenfall, one of Europe's largest producers of wind energy and one of Alfa Ventus' investors.

Large windfarm projects most at risk

But it is projects like these that due to their high initial costs are most at risk from reduced funds. Though cheaper to operate, wind parks and biomass power plants require an extensive initial capital investment that may prove off-putting to funders for the time being.

GE's CEO Jeffrey Immelt, however, tried to allay those fears in an interview with the Financial Times of London Thursday by saying that his company was willing to extend more financing to customers of its industrial businesses next year to help assure key energy, transportation and water projects.

Though the amount of money GE Capital planned to originate in loans during 2009 was a decline from this year, the company, which sells turbines for wind farms as part of its industrial arm, might boost credit to high-growth industries such as wind energy and biofuels.

"We might just sit back and say: 'Well, strategically, we may want to double wind in 2009 because they might not otherwise be able to get financed, and because we think we can get profits during the cycle,'" Immelt said.

Triodos Bank's renewable energy fund is likewise continuing to invest in renewable energy, including a wind farm project off the coast of the Netherlands.

Further down the pipeline

What lies in store for the renewable energy sector should money remain tight over the coming years, however, remains anyone's guess. With the German landscape already overflowing with windmills, exports are playing a larger role in keeping the industry afloat here.

Germany's export sector has seen an annual growth rate of almost 25 percent in the renewable energy industry over the last three years, climbing to 56 billion euros in 2006. A slowdown in other countries, such as Spain and the US, could spell trouble for the clean energy sector here.

Still, not everyone thinks the sky could fall in on the renewables sector.

"We have to have renewable energy," said Vatenfall's Wiese. "It's that simple."