China climbs its way up global renewable investment ranking
China moves ahead in list of the world’s most ripe spots for renewable energy investment
At this rate, China is expected to lead the world in terms of investment in renewable energy this year.
China has moved ahead of Germany and landed just behind the United States for the first time in six years in a list of the world’s most ripe spots for renewable energy investment.
Ernst & Young's renewable energy country attractiveness indices rank countries according to their appeal as investment hubs for renewable energy technologies such as wind and solar power. They include rankings for national renewable energy markets, renewable energy infrastructures and the suitability of individual technologies.
The country has been steadily climbing the indices, having ranked fourth in 2008 and sixth in 2007. Ben Warren, Ernst & Young's environment and energy infrastructure advisory leader, explained that reaching over 150 gigawatts of installed renewable energy capacity has helped China go up the rankings.
At this rate, China is expected to lead the world in terms of investment in renewable energy this year.
He also cited other factors for China’s strong showing such as local providers turning into major players in the global solar and wind market, the Golden Sun incentive program and the country’s plans to double its renewable energy target to 10 percent by 2020.
China has also relaxed restrictions on the amount of non-domestic components used in manufacturing, allowing greater foreign participation in its market.
Brazil and Japan are also rising in the rankings. Japan’s new target for greenhouse gas emissions cuts from 8 percent to 25 percent based on 1990 levels by 2020 was said to have been a significant driver.
Meanwhile, Brazil is looking for 7.3 GW of wind, biomass and small hydro combined generation following an energy plan that would help the country source 10 percent of its energy needs from renewable energy by 2020.
Britain’s ranking climbed by one to sixth in the entire global renewable index. The country’s £1.15 billion investment in power grid improvements and the speed of growth of its renewables industries in tiger economies affected its ability to attract investments.
Eastern Europe attracted more investors looking for new, high growth potential markets over the last year. However, solar module prices in the region are under increasing pressure from Chinese products as raw materials become cheaper.
While Mr. Warren said funding for climate adaptation that would be agreed in Copenhagen is important, but he also stressed that governments must enforce needed policy and regulation that will affect both people’s lifestyles and businesses.
"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," says Mr. Warren.
- Oliver Bayani
