AMERICA has seen its position as the most attractive destination for investment in renewable energy nosedive, helping Germany to move to joint first place.
This emerged in Ernst and Young’s latest renewable-energy country attractiveness indices which track and score global investment in renewables. They also revealed there had been a record reduction in the attractiveness of all 20 countries included for the first time since their creation five years ago.
Jonathan Johns, head of renewable energy at E&Y, said that, although the financial crisis had negatively impacted the attractiveness of all countries in the indices, the US had borne the brunt of the economic slowdown.
The UK moved one place to joint fifth, sharing the position with Spain.
While Britain’s position had been bolstered by the extension of the Renewables Obligation and the enactment of the Energy and Planning Act 2008, E&Y said the UK industry was facing increasing cost pressures because of the decline of the pound versus the euro.
Mr Johns said: “The falling value of the pound is making UK renewable projects increasingly expensive as (the costs of) imported technologies from (elsewhere in) Europe continue to rise as a result of the exchange rate.
“The declining price of oil is compounding the problem by reducing project revenue as wholesale energy prices fall, resulting in many projects becoming uneconomical. It is unlikely that falling commodity prices such as steel and copper will compensate enough.”