U.S. and China are the top two most attractive global locations to invest in renewable energy projects, according to Ernst & Young’s latest global renewable energy country attractiveness indices. Rounding out the top five are Germany, India and Spain.
China has moved steadily up the ranking from number four in 2008 and number six in 2007. China, which is ranked just behind the U.S., has moved ahead of Germany for the first time in the reports’ six-year history due to its increased commitments to reduce emissions through its carbon intensity reduction plans, according to the study. Earlier this year, China announced the Golden Sun subsidy scheme that will support 500 megawatts (MW) of PV installations over the next two to three years, along with four other major solar projects that deliver 1.8 GW of installed capacity, according to the report.
The Ernst & Young Indices rank countries according to their desirability as locations for investing in renewable energy technologies including wind, solar biomass and geothermal power. The indices provide rankings for national renewable energy markets, renewable energy infrastructures and their suitability for individual technologies.
The indices also see increases for both Brazil, which moved up from rank No. 20 to 17, and Japan, which rose by one slot to rank No. 20, due to their beefed up renewable energy plans and greenhouse gas (GHG) reduction targets. The Japanese government’s new targets to reduce greenhouse gas emissions by 25 percent (based on 1990 levels) by 2020 are a significant increase on previous targets of 8 percent, said Ernst & Young. Brazil’s energy plan to 2017 includes 7.3 GW of wind, biomass and small hydro combined generation capacity to meet a 2020 target of 10 percent of consumption from renewable energy.
The report shows that the UK has risen one point (ranked No. 6) following additional announcements relating to grid connection improvements. But Ernst & Young said the speed of growth by the renewables industries in the tiger economies has impacted the UK’s ability to attract significant investment from the global market.
However, the UK is poised to adopt a national feed-in tariff, which is expected to drive growth in the UK solar industry next year.
In the U.S., although the ambitious climate change bill has not yet been passed, forecast developments remain optimistic, according to the report. In Eastern Europe, investment has become increasingly attractive over the last year as investors increase their interest in new high-growth potential markets, said Ernst & Young.
However, further consolidation is expected in Europe’s solar module manufacturing industry as it comes under increasing price pressure from Chinese products as the cost of raw materials has fallen, according to the report.