The UK’s appeal as a destination for investment in renewable energy is now at its lowest level in 12 years, according to EY’s Renewable Energy Country Attractiveness Index.
This is as a result of the continuing lack of clarity around the future role of renewable energy within the UK’s overall energy mix and the policy hiatus caused by the general election in may.
Meanwhile, a lack of clarity around whether or not the recently announced Contract for Difference regime will be sufficient to stimulate investment also contributed to the slip in the rankings.
The report found that internationally, competition for investment in energy infrastructure is intensifying, posing a threat to the UK’s ability to attract investors.
France’s energy transition bill is progressing through the legislative process, with additional details emerging on its ambitious clean energy agenda.
Markets such as India and Chile are pulling in large volumes of foreign investment at historically low costs of capital.
EY energy corporate finance leader Ben Warren said: “The upcoming election means that we can expect an effective moratorium on energy policy. While it is encouraging that politicians are using this ‘down-time’ to issue cross-party pledges on climate change, there is little or no policy behind the rhetoric to convert this into concrete commitments.
“As a result, the role of renewable energy in the UK’s long-term energy strategy remains unknown at a time when it has become affordable, quick to deploy and can deliver real jobs for the economy.
“With the UK’s top 10 position now heavily reliant on the appeal of offshore wind, the country’s future ranking in the Index will remain uncertain until the cost of investing in this sector comes down enough to make it a viable alternative.”