Ireland has maintained its standing in the latest edition of the EY Renewable Energy Country Attractiveness Index (RECAI) remaining in 13th position overall at a time when global investment in renewable energy is soaring as Governments eye domestically produced, low-cost, low-carbon energy in a bid to reduce their dependence on imports.
The RECAI is EY’s biannual flagship global renewables report. Now in its 61st edition, the index ranks the world’s top 40 markets based on the attractiveness of their investment in renewable energy and deployment opportunities.
Ireland’s overall global ranking of 13th remains unchanged since the last index, in November 2022. Notably, Ireland has climbed four places and is now ranked 19th in terms of use of Corporate Power Purchase Agreements (CPPA), an arrangement where a company procures renewable electricity through a direct contractual agreement with a renewable electricity generator. This reflects the significant increase in the use of CPPAs in Ireland over the past 24 months as major corporates advance on their decarbonisation agendas, and it bodes well for achieving the goal set out in the Climate Action Plan to generate 15% renewable energy through such agreements.
The global index also specifically references the success of Ireland’s recent Offshore Wind Auction, which saw some of the most competitive pricing for offshore wind deployment seen anywhere in the world. The pipeline of future projects is also flagged, and the opportunity for Ireland is clear in the context of competitive advantage in offshore wind development attractiveness.
Stephen Prendiville, EY Ireland Head of Sustainability said:
“The global drive for energy security and a recessionary environment means the renewables industry has never had a better opportunity to accelerate. Interdependent legacy market dynamics are no longer seen as sustainable, while domestically produced, low-cost, low-carbon – and in some cases, low-lead time – energy looks more attractive than ever. Globally, we are seeing that developing policies to encourage the buildout of renewables has risen to the top of government agendas right around the world.
“The EY Renewable Energy Country Attractiveness Index rankings once again confirm that Ireland is the Goldilocks among nations for renewable energy development, combining the right blend of policy, structures, available finance, talent, resources, and drive to succeed. The rankings and analysis point to significant upside potential across many of the renewable technologies currently being deployed, such as wind (onshore and offshore), solar, biomass and hydro. Our stable economy and geographical positioning in the flow of material supply chains combined with capital investment, educated and skilled workforce, and the Government’s ambitious climate action policy, make Ireland a leading nation in this space.
Notably, the report makes a particular reference to Ireland’s potential in offshore wind. We also know that there is significant potential for Ireland in area of green hydrogen production and storage. If we can unlock our full potential as part of the planning system reforms currently under investigation, I expect Ireland will climb the rankings quickly – and more importantly – we’ll be leading the way for the energy transition and positive climate action.”
Commenting on the increased use of CPPAs, Anthony Rourke, EY Ireland Government and Infrastructure Advisory Director, said:
“The energy crisis of the past 18 months has accelerated the energy transition plans of many medium to large users. Equally, many more businesses are demonstrating their commitment to delivering on their decarbonisation plans. In many cases CPPAs are a critical component of these strategies. We have seen the commercial imperatives line up strongly with the climate action agenda. This is driving a marked increase in enquiries and transactions in this space as a result.”
US Inflation Reduction Act changes the game
The US maintains its top position in the Index, supported by the passing of the Inflation Reduction Act (the Act) in August 2022, which earmarks a combined US$369b for investment in energy security and climate change.
Ten months since its passing, this edition of RECAI seeks to explore how capital reallocation is impacting investment opportunities in markets outside the US. Among European politicians and policymakers, there are concerns that the Act is incentivising developers and manufacturers to locate investments in the US and away from Europe. And similar concerns have emerged elsewhere in the world, with governments examining the impact and formulating their responses at the policy level.
Arnaud de Giovanni, EY Global Renewables Leader, says:
“Legislation has sparked a race to the top among international markets eager to boost the competitiveness of their renewables industry. And with investment in green technologies benefitting from an impressive 19% rise last year, testament to the accelerating pace of the energy transition, a unique opportunity has emerged for the industry, worldwide, to double down on efforts to stimulate renewables supply and demand.”
To view the full RECAI top 40, the normalized RECAI ranking and the corporate power purchase agreement index, as well as an analysis of the latest renewable energy developments across the world, visit ey.com/recai
