A latest report from industry analyst firm Clean Edge predicts continued healthy growth in solar, wind and other high profile clean energy industries.

But look for the biggest growth in the fuel cell market, according to the report, forecasting an increase of more than 11x in the next ten years, even without taking into account fuel cell vehicles.

In its report Clean Energy Trends 2007, released today, Clean Edge forecasts that the fuel cell sector will continue to grow steadily from $1.4B in 2006, primarily for research contracts and demonstration and test units, to $15.6B over the next decade.

By comparison, the group is predicting 3x to 4x growth in solar, wind and biofuels over the same time period.

Clean Edge sees the increase coming primarily from stationary fuel cells used in power plant and combined heat-and-power (CHP) applications. (examples: Sierra Nevada Brewing buys fuel cell power plants and Cal State Northridge fuel cell power plant now online.)

And if anything, its fuel cell sector growth estimates may be conservative, Clean Edge said in a press conference this morning.

"The one wild card in fuel cells is in Japan, where the government is calling for tens of thousands of stationary residential fuel cell systems and fuel cell vehicles over the next 5-10 years. If Japan is successful, our numbers will need to be revised."

The Japanese government has set a goal to power 1.2 million homes with fuel cells by 2010 – a total of 1.2GW of distributed generating power, and has provided subsidies and other incentives to encourage uptake. While appearing ambitious, that only represents around two per cent of the country’s 47 million households - indicative of a major market opportunity there and elsewhere.

In recent months, major automakers have announced fuel cell vehicles (see Ford's HySeries Drive to power other vehicles and Honda to take until 2018 to produce fuel cell cars.)

Yet despite optimism about stationary applications, Clean Edge analysts don't expect significant uptake of fuel cell cars in the near future, highlighting the evolution of electric batteries as a trend of more significance to the transportation industry.

"Hydrogen is not going to be the realm of mom and pop sedans anytime soon," said Joel Makower, co-founder and principal of Clean Edge. "It's going to be a specialty fuel, one of a myriad of fuels we'll be using in the diverse transportation world of the future."

Makower pointed to encouraging use of fuel cell vehicles in niche transportation markets, such as golf cart and forklift applications (see Fuel cell trucks complete trials at Wal-Mart.)

"I wouldn't write the obituary yet for fuel cell vehicles," said Ron Pernick, co-founder and principal of Clean Edge. But fuel cell cars always tend to be 10 to 15 to 20 years out."

Overall, Clean Edge measured that the global clean energy markets expanded to $55 billion in 2006, "considerably larger than the global recorded music industry," said Pernick, and projected that it will quadruple over the next decade and exceed $220 billion by 2016.

Its new report shows U.S. energy-tech investments grew to $2.4 billion in 2006, representing 9.4 percent of total VC investments. That's consistent with figures from the Cleantech Venture Network, which tracks investment across all says cleantech sectors, not just energy (see Cleantech investment topped $3.6B in 2006.)

The report cites an influx of venture capital, new levels of commitment by politicians and significant corporate investments in clean-energy acquisitions and expansion initiatives as industry drivers.

According to the report, for the second year in a row, the global biofuels market was slightly larger in 2006 than both solar and wind, reaching $20.5 billion in 2006 and projected to grow to more than $80 billion by 2016. Clean Edge projects solar photovoltaics to grow from a $15.6 billion market in 2006 to $69.3 billion by 2016. Wind power installations are to expand from $17.9 billion in 2006 to $60.8 billion in 2016.

Trends that will shape the clean-energy landscape this year, according to the report, are to include carbon trading, closed-loop biorefining, battery advances, the emergence of Wal-Mart as a clean energy market maker and the continued greening of utilities.

Clean Edge collaborated with Nth Power, an energy technology VC firm, on the venture data for the third year running.