The prospects of a record-breaking year for solar in China have helped propel the country to the top of Ernst & Young’s list of the world’s most attractive destinations for renewable energy investment.
After a grapple with the US since the beginning of last year, China reclaimed the top slot in EY’s latest renewable energy country attractiveness index and also the number one position for investment in solar.
EY said this was because of the increased government support and 8GW target set for distributed solar, which the consultancy said could help China replicate the “phenomenal growth” already seen in its utility-scale solar sector.
“China’s government is placing increased emphasis on renewable energy as the country battles pollution, ushering in new market opportunities for foreign investors. Aggressive policy targets, an increased focus on consolidation and the roll-out of pilot carbon emissions trading schemes also support the country’s pollution reduction initiatives and reflect the renewables sector’s strategic economic value,” said Gil Forer, EY’s global clean-tech leader comments.
Elsewhere in the index, the UK saw its position slip to seventh place, its lowest since December 2009.
EY said the dip in investor confidence was due to the UK government’s plans to cut the renewable obligation support for large-scale earlier than expected and because of uncertainties surrounding the replacement contracts for difference regime.
Germany managed to hold on to third place in the index, but EY warned that Europe’s solar pioneer should be “watched closely” as changes to the country’s EEG renewable energy laws, which have seen solar hit with new generation charges, take effect.
The report said Europe was at an “inflection point” whereby it is still striving to be a leader in renewables, but is under strain to maintain funding and supply capabilities.
Ben Warren, EY’s Global Cleantech Transactions Leader, said of Europe’s predicament: “The industry must liberate itself from the shackles of the past and go in search of grid parity as the fastest route to secure and affordable energy. The role of policy-makers therefore becomes one of enablement rather than fiscal support, as well as looking to create a level playing field across all energy sources through greater cost transparency.”
Japan also held on to fourth place, but EY said that could change as the nuclear debate reopens.