Changes to support for onshore wind were “jeopardising the sector’s competitiveness”, it said.
The government has said cuts to subsidies are urgently required to ease upward pressure on energy bills, while sources have indicated a new low carbon energy strategy will be developed over the autumn.
“Worryingly, this development of inconsistent coverage tinkering might additionally bitter investor confidence in different areas, similar to new nuclear, carbon seize and storage (CCS) and shale fuel, in addition to offshore wind”.
Specifically, according to EY’s accompanying press release, “a wave of policy revisions to reduce or remove support for onshore wind and solar projects in the United Kingdom threaten to paralyse the industry” – which should come as no real surprise to those who have been following along.
The report said other notable index movements included Mexico’s rise to 19th place in the wake of a transition to a wholesale electricity market and tradeable renewable energy certificate regime that is attracting significant worldwide investment; while Turkey’s long-term investment and deployment potential has seen it jump to 15th place. It can continue to fight this policy tinkering, or see this as an opportunity to throw off the shackles of policy dependency and establish itself at the forefront of unsubsidised renewables in Europe.
The survey, which asked 10 “active onshore wind investors” – and received responses from seven – assessed their willingness to fund investment following the government’s decision in June to close the Renewables Obligation (RO) subsidy scheme – funded by levies added to utility bills – in 2016 instead of 2017 as previously planned.
“Our members have already expressed concern that they were entering an investment hiatus and this survey of lenders would indicate their suspicions are well founded”, he said. Industry is ahead of government in the need to protect the consumer while keeping the lights on and tackling climate change.
The National Offshore Wind Association of Ireland (NOW Ireland) has warned that under existing Government policy Ireland will miss its binding European Union renewable energy targets.
A DECC spokesman stated: “Authorities help has pushed down the price of renewable power considerably, making it more economical for buyers. Targets alone will not construct new projects, but long-term visibility increases investor confidence that demand is there, and maintains momentum as we hurtle towards universal grid parity for renewables”. Despite challenging economic conditions in Brazil, government proactivity in addressing key challenges such as low tariffs, and an increasing focus on its untapped solar market takes it up to eighth place.
Renewables developers in Australia and Spain are also suffering from policy tweaks, EY found, while Chile’s technology-neutral energy auctions got it into the top 10. In today’s world, where the majority of the population is facing some form of energy crisis, public support for low-carbon energy solutions and the increasingly compelling economics, flexibility and scalability of renewables can not be ignored. States will plan strategically for current and future environmental and economic goals related to the energy sector.