Ireland has moved up 6 places from 18th to 12th out of 40 countries in the latest Renewable Energy Country Attractiveness index published by EY. This index examines the attractiveness of countries to those investing in renewable energy activity and projects.
Despite the global slowdown caused by COVID-19, the renewable energy sector is expected to bounce back quickly as the long-term drivers for investment remain strong, according to the 55th EY Renewable Energy Country Attractiveness Index (RECAI). The latest attractiveness index considers the potential impact of the pandemic and looks at the resilience of countries in the index.
Anthony Rourke, EY Ireland Government and Infrastructure Advisory Director, commented:
“Ireland’s ranking has been improved in the latest country attractiveness index as a result of the detail provided by the Government on the Renewable Energy Support Scheme (RESS) at the end of last year. Under this scheme, the Irish Government will hold auctions between 2020 – 2027 and as a result, we anticipate a growth in Ireland’s renewable energy capacity by 30% over the next three years.
This will contribute to Ireland’s efforts to reach its 70% renewable energy target by 2030 across the solar and onshore/offshore wind sectors. Ireland’s strong performance this year is also attributed to the significant 46% reduction in the use of coal and oil in generating power since 2015.
“Plans for the Climate Action (Amendment) Bill 2020 which will set a target to decarbonise the economy by 2050 at the latest, published in the new programme for Government, should further support Ireland’s position in future rankings.”
The EY report highlights how climate change and other environmental, social and governance (ESG) issues are being increasingly recognised as key determinants of a company’s future value creation potential.
Institutional investors are demanding that businesses not only deliver financial performance but also show how they make a positive contribution to society. As a result, companies are having to re-evaluate their corporate strategies to curb their emissions, enhance their governance, and improve their climate-related disclosures. This has resulted in institutional investors increasing the capital they are allocating to renewable energy infrastructure as a means to hedge their climate exposure, according to our analysis.
Anthony Rourke added, “This in many ways is a defining and transformative moment for the energy industry. Investors are increasingly seeking to collaborate and invest in companies where climate change and sustainable development is embedded in their strategy. Environmental, social and governance issues together with climate change remain the dominant long-term drivers for renewable investment here in Ireland. Investors are looking for reassurance that companies understand this link between the non-financial performance of the business and the successful delivery of the business strategy.”
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