Ben Warren, Ernst & Young's Environment and Energy Infrastructure Advisory Leader, explains, "China is increasingly focused on its renewable energy industries. Since 2007, which saw China take top spot in the world by reaching over 150GW of installed renewable energy plant, local solar PV and wind technology providers have become major players on the global stage: there have been ambitious plans for solar PV; the Golden Sun incentive program has been announced; and recent suggestions that China will double their renewable energy contribution targets to 10% by 2020. Furthermore, China is also relaxing its restrictions on the amount of non-domestic components used to manufacture generation technologies. In fact, China is now expected to lead the world in terms of investment in renewable energy in 2009."
The Ernst & Young Indices rank countries according to their desirability as locations for investing in renewable energy technologies such as wind and solar power. The indices, which set scores out of 100, provide rankings for national renewable energy markets, renewable energy infrastructures and their suitability for individual technologies.
Country comparisons
The indices also see rises for both Brazil and Japan. The Japanese government's new targets to reduce greenhouse gas emissions by 25% (based on 1990 levels) by 2020 are a significant increase on previous targets of 8%. And Brazil's energy plan to 2017 includes calls for 7.3GW of wind, biomass and small hydro combined generation capacity to drive towards a 2020 target of 10% of consumption to be met by renewable energy.
The UK has risen one point (ranked sixth) following further announcements relating to improvements with the grid connection process and a further 1.15bn pounds of investment in the grid, which is cause for optimism. But the scale of some overseas markets, and in particular the speed of growth that is being achieved by the renewables industries in the tiger economies, has impacted the UK's ability to attract significant investment from the global market.
In the US, the ambitious climate change bill has not yet been passed, however as the worst of the credit crunch starts to ease, forecasts developments remain optimistic. In Eastern Europe, investment has become increasingly attractive over the last year as investors seek to exploit new, high growth potential markets. Manufacture of solar modules in Europe has come under increasing price pressure from Chinese products as the cost of raw materials has fallen, with further consolidation looking likely in the sector.
Ben Warren added: "If global agreement is achieved in Copenhagen, a host of new policies and regulations will emerge worldwide, catalyzing a global energy revolution, altering the way and the extent to which we travel, and providing enormous stimulus for technology innovation. Huge volumes of capital will be required from the public and private sectors to deliver this change.
"A global deal on climate change will create a significant impetus and urgency for all governments to enforce policy and regulation that will transform the way we live our lives and the way we all do business.
"Forward-thinkers and first-movers stand the best chance of achieving both top-line and bottom-line returns, while those companies that see climate change regulation and policy as a compliance cost, will see their value steadily erode."
