Europe regains ground in renewable energy investment attractiveness index

Singapore, 26 October 2016

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  • France, Belgium, Sweden, Ireland, Norway and Finland climb ranking
  • UK continues to lose renewables investor appeal
  • Majority of renewable energy green bond activity in 2016 hails from Europe

The latest bi-annual EY Renewable energy country attractiveness index (RECAI) sees European countries regaining ground after falling down the ranking to emerging markets in May 2016.

In the index top 10, France moved up one position to 7th as a result of the country’s plan to tender for 3GW of new solar capacity over the next three years. Construction of a factory to produce solar panels to pave 1,000km of road work is also currently underway in the country.

Belgium (18th), Sweden (20th), Ireland (30th), Norway (32nd) and Finland (35th) also climbed up the ranking of 40 countries. In Norway, work on a US$2.3b undersea tunnel to Germany offers a new wind-hydro storage opportunity between the countries. Germany, in addition to the United States, China, India and Chile, remained unmoved in the index top five.

Ben Warren, EY Global Power & Utilities Corporate Finance Leader and RECAI Chief Editor, says: 

“European countries lack the flexibility that exists in emerging markets to transform their energy industries. Their greatest hurdle is integrating renewables with historically centralized conventional power generation. It began to look like European countries were scaling back their renewables ambitions as a result but, in recent months, we’ve seen promising new programs materialize around the continent.”

The United Kingdom, however, is bucking the trend in European improvement, falling to an all-time index low in 14th position. The United Kingdom’s vote to leave the European Union, the dismantling of the Department of Energy & Climate Change (DECC) and approval of the Hinkley Point C nuclear power station all contributed to a loss of appeal in the eyes of investors.

When it comes to renewable energy green bonds, the report finds Europe experienced the greatest share of activity. A total of US$54.9b in renewable energy green bonds were issued in Europe since 2007, followed by North America with US$19.8b and Asia with US$4.5b.

Warren says: “The green bond market is enabling corporates, banks and development finance institutions to tap into enormous demand among investors for clean energy projects. In the last few years, we’ve seen significant growth in green bonds sold by issuers with plans to direct proceeds to environmental ends.”

Sixty-five percent of the proceeds of green bonds sold since the market’s inception in 2007 – or US$95.6b – have been channeled to renewable energy. As of July 2016, US$48.2b of green bonds had already been sold this year, compared to total full-year amounts of US$41.8b in 2015 and US$36.6b in 2014.

Warren says: “Green bonds currently serve to refinance existing projects for issuers and tick a box on the corporate responsibility agenda for investors. The ideal future state will see these financing vehicles used to bring new renewables projects to life.”


Notes to Editors

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In a world of uncertainty, changing regulatory frameworks and environmental challenges, utility companies need to maintain a secure and reliable supply, while anticipating change and reacting to it quickly. EY’s Global Power & Utilities Sector brings together a worldwide team of professionals to help you succeed — a team with deep technical experience in providing assurance, tax, transaction and advisory services. The Sector team works to anticipate market trends, identify their implications and develop points of view on relevant sector issues. Ultimately, this team enables us to help you meet your goals and compete more effectively.

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About the report

The RECAI has been refreshed in 2016, with the measures driving all scores recalibrated to match the new reality of imminent grid parity.

For more information, please visit