China, which is ranked just behind the US, has moved ahead of Germany for the first time in the reports' six-year history having been fourth in 2008 and sixth in 2007, Ernst & Young writes.
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 150 GW 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 programme 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, Ernst & Young writes. 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 7.3 GW 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 £1.15 billion 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 renewable energy industries in the tiger economies, has impacted the UK's ability to attract significant investment from the global market, Ernst & Young says.
In the USA, 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 PV 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 adds: "If global agreement is achieved in Copenhagen [COP15], a host of new policies and regulations will emerge worldwide, catalysing 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.”