Alternative energy exchange traded funds are getting a closer look from investors as governments around the world focus more efforts on clean and renewable sources of power.

Within the group, solar ETFs have been volatile this year but are in negative territory for 2011.

Brean Murray analyst Wayne Chang believes Germany, the solar industry’s largest market, may experience “dramatically higher” than expected demand this year, reports Chris Kahn for Forbes. Additionally, demand in Italy may also rise in late June and July once banks restart lending for projects. [GT Solar Receives Its Largest Order Ever; Solar ETFs Remain Muted.]

Chang also commented on how solar is becoming competitive with traditional energy sources, such as natural gas or coal. He believes costs of producing solar power will be on parity by 2012 to 2013 in European markets.

Germany is committed to shutting down all of its 17 nuclear power plants after the disastrous events at Japan’s Fukushima Dai-ichi nuclear plant and will be focusing on alternative energy. Italian Premier Silvio Berlusconi commented that the country will likely give up further plans on nuclear energy and turn to renewables instead. Additionally, China has also shown interest in renewables in the wake of the events in Japan.

A recent report conducted by Pike Research reveals that the military complexes, such as the Pentagon, around the world are looking into renewable energy development to increase efficiency and reduce their wasteful energy practices, according to UPI. The findings indicates that governments will be investing in new technologies to further advance the science of renewable sources of energy in peacetime and warfare. All military branches within the Pentagon alone form the largest energy consumer in the world.