The UK has become a less attractive nation to renewables investors according to professional services firm EY.
In its quarterly Renewable Country Attractiveness Indices report, EY reported that the UK market has slipped to 5th place behind Japan.
EY said this was caused by a combination of prolonged policy uncertainty, news that mature technologies must compete for Contracts for Difference (CfD) and the cancellation of a series of offshore wind projects.
Japan has moved up to fourth place as a result of rapid solar market growth and a burgeoning offshore sector.
“The UK’s fading appeal is the direct result of the lack of clairty on the government’s long-term energy strategy at a time when energy security is a concern and investors are looking for commitment,” said EY environmental finance leader Ben Warren.
“Recent announcements around CfDs have been perceived by some investors as a risk to investment stability, for onshore wind in particular, given the regime changes and subsidy cuts already planned.
“At the same time, the UK offshore sector has also taken a battering, with a number of high-profile projects being mothballed in recent months.”
Despite this, he said the UK market remained more resilient than other big European markets.
“In 2013, despite an 11% dip of investment in the sector globally and 44% across Europe, the UK market only saw a modest 8% decline from the record number of £14.3bn investment in 2012,” said Mr Warren.
“The UK Government and the renewables sector need to work together to regain investors’ confidence and realise the UK market’s potential.”
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