No big changes at the top of EY index as countries step up renewables

PPA Index. Image by EY (www.ey.com)

The US and China continue to top the EY Renewable Energy Country Attractiveness Index (RECAI 60), shows its 60th edition, released today to coincide with Energy Day at COP27.

Ernst & Young Global (EY) said that geopolitical tensions and high gas prices are causing governments around the world to accelerate their renewables programmes. The US remained number one in the index due to the Inflation Reduction Act passed in August.

China, ranked second, retains its commitment to accelerating its renewable energy transition, the consultancy said. It is expected to install a record 156 GW of wind and solar capacity by the end of 2022, a 25% rise on 2021 installations.

Germany moves up one spot to the third position as its Easter package commitment is expected to bolster renewables expansion. The UK has ceded its leadership in offshore wind capacity to China and moved down to fourth place but still has a large pipeline and offshore wind is a key part of the government's energy strategy, EY notes.

Top 10 of RECAI

Market	Rank	Previous rank
US	1	1
China Mainland	2	2
Germany	3	4
UK	4	3
France	5	5
Australia	6	6
India	7	7
Spain	8	9
Japan	9	8
Netherlands	10	10

The current RECAI edition for the first time includes a ranking that is normalised with the gross domestic product (GDP), which highlights markets performing above expectations for their GDP. This normalised index is headed by Morocco, followed by Greece, Denmark, Jordan and Chile.

EY said that the volume of power generation committed through corporate power purchase agreements (PPAs) in 2022 is poised for a rare year-on-year decline in 2022 due to the current market volatility, although fundamentals remain strong.

Its PPA index is again led by Spain, which accounts for around one-third of new PPA capacity in Europe so far this year. India has climbed to the eighth position after policy changes giving more flexibility and clarity to offtakers, the firm said.

Top 10 of the PPA index

Market	Rank	Previous rank
Spain	1	1
Germany	2	3
US	3	2
UK	4	4
Australia	5	5
France	6	6
Denmark	7	10
India	8	14
Netherlands	9	9
Sweden	10	7

EY also highlighted the growing need for energy resilience.

"To reach net zero, the integration of renewables must improve significantly. Distributed energy resources have a vital role to play in allowing a range of green energy sources to be integrated into the grid. Additionally, investment in smart grids will be key to securing energy supplies and getting the world to net zero by 2050," said Arnaud de Giovanni, EY global renewables leader.

Choose your newsletter by Renewables Now. Join for free!