| 20 May 2024, Monday |

IHS: US top market for renewable investment

The US has arose as the top market for renewable investment, as President Joe Biden’s administration passes wide-ranging reforms to develop the clean energy sector.

The world’s top hydrocarbons producer was placed first in the Global Renewables Markets Attractiveness Rankings, commissioned by IHS Markit.

The index, which rates countries based on their desirability among investors in non-hydro renewables, such as wind and solar, praised the US for its sound market fundamentals.

Germany, which leads clean power initiatives in the EU, ranked second.

China, the world’s top oil importer, was placed third in the rankings. The world’s second-largest economy accounted for over half of all non-hydro renewable capacity additions last year.

“Onshore wind, offshore wind and solar PV are set to account for over 80 percent of all new power generation capacity additions globally to 2030,” said Eduard Sala de Vedruna, executive director of global clean energy technology and renewables at IHS Markit.

“While the lion’s share of 2020 capacity additions came from just two markets –China and the United States – close to 50 markets recorded double-digit growth in the past year,” he added.

Oil majors in the US are facing increasing scrutiny as Mr Biden’s administration continues to push for a transition to cleaner sources of energy in a bid to lower emissions. It has frozen new exploration activities on federal lands and has brought the US back to the Paris Agreement, which seeks to limit emissions to below 2°C above pre-industrial levels, preferably about 1.5°C.

The US also plans to lower its carbon emissions by 50 percent by 2030 from its 2005 levels.

France and Spain are ranked fourth and fifth, respectively, by IHS, which cited their strong market fundamentals, stable procurement mechanisms and long-term clean energy targets.

India, a top energy consumer that is looking to phase out its dependence on coal, is ranked sixth, while Australia is placed seventh.

However, both countries are “beginning to encounter infrastructure constraints on their continued path towards decarbonisation”, IHS said.

Onshore wind in India has suffered from a lack of grid and land access, while uncertainty over federal and state ambitions in Australia have increased investor uncertainty.

“While strong ambitions are perceived positively by investors and testify to a market’s commitment towards renewables, this needs to be backed by a well-conceived implementation framework, adequate infrastructure and durable policies,” Indra Mukherjee, IHS Markit’s senior analyst for global clean energy technology and renewables, said.

Japan, which pledged to become carbon neutral by 2050 last year, is ranked eighth. The Netherlands is ranked ninth, while Brazil rounds out the top 10.

  • The National News