EY Report: India Slips to Fourth Position on Renewable Energy Country Attractiveness Index
India conceded the second position due to investor concerns in its domestic market, the report noted
May 4, 2018
India has fallen from second to fourth position on the Renewable Energy Country Attractiveness Index (RECAI) compiled by global consultancy firm EY. The report cited investor concerns as the main reason for the country’s fall.
The 51st issue of the RECAI highlighted the trends for rising protectionism across various renewable energy sectors. Here are some important points from the RECAI report on various countries:
- China is leading the latest RECAI for the third time consecutively.
- Previously, Mercom reported that the year 2017 proved to be an outstanding one for China’s solar industry. The country added an astounding 53.06 GW in solar installations a 54 percent year-over-year (YoY) increase in terms of solar photovoltaic (PV) power capacity addition by the end of 2017, compared to 34.54 GW installed in 2016.
- The U.S. and Germany have overtaken India, to secure second and third place respectively.
- Indian solar installations in calendar year 2017 grew exponentially with the addition of 9,629 MW in new large-scale and rooftop solar capacity. The installation total was more than double the 4,313 MW installed in 2016 and made 2017 the best year for solar installations in India to date.
- The report, however, observed that India’s 2022 solar power target looks increasingly over-ambitious amid investor concerns, in response to the threat of a 70 percent tariff on imported solar panels and low power bids. “Although solar tariffs have risen slightly in Gujarat’s latest auction, aggressively low bids in 2017 wind and solar auctions now seem unsustainable. The threat of solar import tariffs and disputes between developers and distribution companies are raising investor concerns,” the report noted.
- In January 2018, President Trump revealed the much-anticipated anti-dumping tariffs on imported solar cells and modules at 30 percent for the first year, which will gradually decline in five percent increments over a four-year period to 15 percent by 2022. The first 2.5 GWs of solar cells and modules will be exempt from tariffs.
- However, RECAI points to the resilience of the U.S. market, which climbed from third to second position as solar tariffs are mostly absorbed and wind projects are not subject to subsidy cuts under the recently passed U.S. tax reform bill.
- The United Kingdom (U.K.) climbed three places to seventh with the market adapting to subsidy-free solar PV, onshore wind projects, and the repowering of older wind farms.
- The rapid expansion of the renewable energy sector in the Netherlands helped it climb from 15th to 9th spot.
- Re-entering at 31st position, Taiwan has returned to the top 40 for the first time in two years as the government announces its intention to go nuclear-free and takes action to increase renewables to 20 percent by 2025.
The bi-annual RECAI ranks 40 countries on the attractiveness of their renewable energy investment and deployment opportunities. The index was recalibrated in early 2018, with all underlying datasets fully refreshed, according to EY.
Image credit: Azure Power
Ankita is an editor at MercomIndia.com where she writes and edits clean energy news stories and features. With years of experience in the news business, Ankita has a nose for news and an eye for detail. Prior to Mercom, Ankita was associated with The Times of India as a copy editor for the organization’s digital news desk. She holds a Bachelor’s degree in Psychology from Delhi University and a Postgraduate Diploma in journalism. More articles from Ankita Rajeshwari.