UK slips in EY’s renewables index

The latest EY Renewable Energy Country Attractiveness Index (RECAI) lists the countries where renewable energy is most encouraged (politically and financially). China and the US remain at first and second positions respectively, while the UK continues to shift, having at one point fallen out of the top ten, then rising higher, and now falling one place to the eighth position – attributed by EY to concerns over Brexit.

The top ten are:
1. China
2. United States
3. India
4. Germany
5. France
6. Australia
7. Japan
8. United Kingdom
9. Netherlands
10. Argentina

Ben Warren, EY Global Power & Utilities Corporate Finance Leader, commented: “An uncertain political climate – particularly the continuing trade disputes between the US and China, among others – compounded by the increasing scarcity of subsidies, presents a challenging backdrop to the maturity of the renewables sector. However, oversupply will provide a short- to medium-term boost to the price competitiveness of renewables, and is also likely to drive some consolidation upstream. In the longer-term, increasing demand for power from the mobility and heating sectors provides something other than trade disputes for policymakers to focus on.”

The RECAI Index further highlights how renewables technology, and the rise of electric vehicles (EVs) in particular, is playing into market caution. With EVs set to reach price and performance parity with internal combustion engine vehicles from 2025 according to EY research, investors are hedging their bets on new technology. However, this has given rise to considerable uncertainty, not only regarding how quickly EVs displace internal combustion engine vehicles, but also around how charging infrastructure will evolve.

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