Australia has dropped in the annual Ernst & Young rankings of renewable energy attractiveness thanks to doubts over its ability to reach its 82 per cent renewables target for 2030.
India edged out Australia for sixth spot, while Germany climbed into second place, overtaking China.
Another reason cited for the drop was the risk that Australia might not attract the necessary investment for its massive green hydrogen projects.
“Legislation has sparked a race to the top among international markets eager to boost the competitiveness of their renewables industry,”
Arnaud de GiovanniEY global renewables leader
EY says deployment rates of new wind and solar need to at least double to achieve the 82% target.
Australia ranked third in the world in 2020, but has slipped since then.
The US continues to dominate the market, thanks to the power of its landmark Inflation Reduction Act (IRA).It means countries like Australia risk losing out on potential renewable energy investments.
Companies that were considering Australia for investments in green hydrogen are rethinking their plans given the IRA is bringing down costs of production in the US.
“In comparison, Australia’s competitiveness in the nascent green hydrogen space now looks reduced,”
The EY Renewable Energy Country Attractiveness Index
So, how can Australia regain its ranking?EY suggests the proposed Capacity Investment Scheme, designed to provide support for energy storage projects, can potentially help Australia lift its rankings.