Renewable energy now attracts massive amounts of investment, an amount that will only increase as the world transitions to a low carbon future. In 2018 for example, renewable energy investment stood at $332.1bn, while Bloomberg estimate a further $13.3tn will be invested between now and 2050.

In what seems to be a positive investment climate, can each individual country be effectively ranked? Service group EY believes they can, through its “Renewable Energy Country Attractiveness Index” (RECAI) chart.

RECAI examination: how are countries ranked?

EY state that its RECAI rankings “have redefined the questions being asked, based on what we see as global market trends affecting investment and deployment priorities.”

These questions include “Is policy hindering or helping the ability to exploit renewables opportunities in a country?” and “Are essential components in place to ensure project delivery, such as long-term contracts, grid infrastructure and availability of finance?”

The group has worked on five parameters in order to achieve its dataset. The first of these is energy imperative, whether a country has the demand for energy and whether it is affordability.

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The second parameter is called policy enablement, which is based on whether each country has the right long-term energy strategy, policy stability and support mechanisms in place. Examples of this would be the UK’s feed in tariff policy, which until March 2019 gave money to energy providers, or China’s subsides for solar manufacturers, which also ended in 2018. EY state that this parameter has “significant impact” on market attractiveness.

Third is project delivery, which focuses on energy market access, infrastructure and finance as indicators for the market stability of a country. EY poses five questions on project delivery, including “Can projects secure financing?” and “Is there a sufficiently liquid market for different investors to enter or exit renewables opportunities?” to analyse each country’s project delivery abilities.

Technology potential is similar to policy enablement, as it measures incentives like feed in tariffs alongside the strength of natural resources and capacity forecasts. However, EY has since reassessed the mechanisms of tariffs, auctions and green certificates to take account of “complex trade-offs” between price, volume and policy risks.

The final parameter is technology weighting, which is based on current and projected investment volumes. One example is that EY believe that solar will increase in importance as it creates a wider range of opportunities and is flexible and scalable in a range of applications and in global markets.

So which countries make EY’s RECAI top five?

China: huge investment meets huge challenges

China is EY’s leading country for renewable energy investment. The country leads in onshore wind, solar photovoltaics (PV),concentrated solar power and hydropower, and is a joint leader in offshore wind. In total, China has 32% of the world’s total wind capacity and 35% of its solar.

Despite this primacy, EY note that China had a difficult 2018 due to its move towards unsubsidised renewable energy and an end to feed in tariffs for solar power “dramatically” slowed growth.

US: Green New Deal pays dividends

In second place is the US, who are joint leaders with China for offshore wind and also rank highly in onshore wind and solar. EY credits the success of the Democratic Party’s Green New Deal plan, despite its lack of specifics, as something that has shifted the debate in the US.

France: floating offshore wind buoys ranking

Making the leap from fifth place to third is France. France is the leading country in the world for marine energy according to EY’s analysis, but the main reason it has moved in the ratings is due to its leading role in the floating offshore wind market and onshore wind farms.

India: tenders show huge promise, if they go ahead

Moving down to fourth place from third is India. The country ranks second in solar PV behind China and is joint second with France in terms of onshore wind. The Indian government announced in 2018 that it would auction 40GW of wind and solar each year until 2028 to help the country reach 500GW of renewable energy by that year, but worries have emerged due to solar tenders being cancelled and only 20GW of renewable capacity tendered in 2018.

Australia: solar leader braces for stagnant spell

Finally in fifth place and up one place from sixth is Australia. The country ranks strongly is solar power and is steady in others. Despite its ranking in the top five countries in the world, Australian renewable energy may have taken a hit after the “climate election” in May 2019 saw the centre-right Liberal Party triumph over the Labour Party.

Due to high energy prices, the new government has reduced Australia’s climate targets and put AUSD$17bn of energy investments on hold.