China Continues to Dominate Global Renewable Energy Market
Ernst & Young released late August their quarterly global Renewable Energy Country Attractiveness Indices report which showed that China is set to continue it domination of the global renewable energy market, as US elections and political support in Europe prevent other countries from keeping up.
The Ernst & Young report “provide scores in 40 countries for national renewable energy markets, renewable energy infrastructures and their suitability for individual technologies.”
The second quarter of 2012 saw China remain at the top of the All Renewable Index (ARI), with the U.S. dropping 1.5 points to share second place with Germany. The rest of the top five were filled out by a disappointing result from India and the UK.
Ernst & Young predict tough times ahead for China, however, with an oversupply of wind turbines and solar panels, as well as the need to resolve grid transmission issues across the country.
The second quarter saw the US drop their 1.5 points due to the current swirling political climate. With the US Presidential race in full swing, there is uncertainty over the country’s long-term renewable energy strategy, as well as concern over the extension of the Production Tax Credit for wind projects.
Germany, on the other hand, increased a point thanks to the government’s proactive approach to removing barriers to offshore wind development.
“While the US and Germany markets are level within the ARI, the contrast between these two markets is evident,” said Gil Forer, Ernst & Young’s Global Cleantech Leader. “The upcoming elections have led to an understandable slowdown in the decision making process in the US, while Germany is pushing ahead with its ambitious renewable energy agenda — including the introduction of a new solar PV tariff and compensation for offshore grid connection delays.
“Having made positive progress, the challenge now facing Germany is making sure that the necessary infrastructure is in place to ensure the renewable power generated in the north of the country can be shipped to customers in the south. It is important for any country not only to focus on policies that support supply, but also on those that will encourage and simulate demand.”
India, who came in at number 4 dropping a point on the way, recently suffered massive blackouts across the country which subsequently led to speculation that the country has not acquired enough private investment to modernize their power infrastructure, and that the country’s renewable energy investment may suffer amid winder power system reforms.
Rather than gaining any points themselves, the UK rose to fifth position due to a fall in Italy’s ranking, the result of that country’s worsening economic conditions. Despite announcing several policy and subsidy policies during the second quarter of 2012, the general national consensus appears to be that these reforms have fallen short of what was necessary.