France overtakes UK as top European destination for utility supply inward investment

• The UK attracted 39 utility supply FDI projects in 2024, down from 92 projects in 2023.
• France overtook the UK as the top European destination for utility supply FDI with 74 projects.
• Europe overall recorded a 21% decrease in utility supply FDI in 2024.

The UK attracted 39 utility supply Foreign Direct Investment (FDI) projects in 2024, representing a year-on-year decline of 57% from the 92 projects secured in 2023, according to EY’s 2025 UK Attractiveness Survey.

The annual ranking of European countries by their ability to attract inward investment found that France has overtaken the UK as the leading European destination for inward investment by energy and utilities companies. France attracted 74 utility supply projects last year, up 13% from 65 projects in 2023.

Despite project volume falling from 43 to 28, Germany retained third place, followed by Spain with 24 projects, down one from 25 during 2023.

Europe as a whole attracted 239 utility supply FDI projects in 2024, a 21% year-on-year decrease following the 302 projects secured in 2023. The UK received 16% of all utility supply projects in Europe last year, down from 30% during 2023, while France secured 31%, compared to 22% in 2023.

Within the UK, Scotland was the largest regional recipient of utility supply projects in 2024, with 14 projects, followed by London (nine) and the North East (five).

There were 1,452 jobs created by UK utility sector FDI projects in 2024, a 69% decline from the 4,819 jobs created by the sector’s inward investment projects in 2023. The decline in Europe was less severe, with recorded FDI-related utility supply employment down 18% in 2024 compared to 2023.

Software and IT services was the UK’s leading sector for inward investment in 2024, with 161 projects secured nationwide. This was followed by transportation manufacturers and suppliers (75 projects), which includes automative and aerospace businesses, and business and professional services (74 projects). The utility supply sector was the sixth largest source of FDI projects for the UK during 2024, having been joint third in 2023. 

Major decline in new UK utility supply projects

‘New’ projects – as opposed to re-investments or extensions – are one way of assessing a country’s ability to attract fresh investment. Of the UK’s 39 utility supply projects in 2024, 23 were new – a 67% decrease compared to the 71 new projects recorded in 2023.

Europe as a whole also saw its total of new utility supply projects fall by 18% during 2024, from 197 to 161 projects. The UK recorded 14% of all new utility supply FDI projects in Europe, compared to France’s 26% (42 new projects) and Germany and Spain with 13% (22 and 21 new projects respectively).

Lee Downham, Energy and Resources Lead at EY in the UK, said: “The UK experienced a surge in inward investment in renewables in 2023, partly driven by various renewable auction rounds in Scotland, so a subsequent drop off in FDI in 2024 was not unexpected. Nevertheless, the UK must continue to attract a strong pipeline of renewable investments if it’s to achieve its energy security ambitions.

"While investors have traditionally viewed the UK as an appealing destination for clean energy, lengthy planning procedures and slow grid connectivity have been seen as drags on UK attractiveness, in addition to uncertainty over future pricing. To persuade developers to contribute capital to renewable energy infrastructure, the UK must also convince them that prospective projects can be built and operational within a reasonable timeframe. The Government’s recent pledge to accelerate grid connection times for clean energy projects, alongside wider pledges to planning reform, sends encouraging signals to developers and may help get the UK back on track.”

France and US the leading sources of UK utility supply investment

The leading origins of UK utility supply sector projects during 2024 were France and the US, which each contributed five projects.

Across Europe, Germany was the leading origin of utility supply projects as it has been every year for the last decade, despite projects falling 19% between 2023 and 2024, from 37 to 30. US-origin projects ranked second despite a year-on-year fall of 19% – from 26 to 21 projects.

The UK recorded 853 FDI projects in total during 2024, a 13% decline from 2023, making it Europe’s second-best performing country for attracting inward investment. France ranked first in Europe in 2024 with 1,025 projects, a decline of 14% year-on-year.

Investors say UK outperforms rivals when it comes to renewables power mix

Alongside an analysis of investment numbers, EY also conducted a survey comprising of interviews with a panel of 400 international investment decision-makers, between January and March 2025.When asked which areas the UK should focus on to help maintain its competitive position in the global economy, the most popular response – given by more than a third (38%) of investors – was supporting strategic industries such as the cleantech and AI sectors.

There were also encouraging signs that investors still think the UK outperforms its rivals in various sustainability-related issues. Nearly two thirds (65%) of investors said the UK performs better than competitors when it comes to the percentage of renewables in its electricity supply, while the majority (56%) also believe the UK’s ecosystem of innovative, cleantech and sustainability businesses is superior to that of other countries.