Both China and India have adopted sustained policy measures to diversify their energy mix and move towards cleaner sources, said the EY report. Not only are emerging economies like India and China moving away from hydrocarbons, a noteworthy trend in this year's ranking is that countries like Kazakhstan, Panama, and the Dominican Republic, which are taking pro-active efforts to reduce dependence on fossil fuels, have entered the list.
In India's case, the country has taken strident steps to revive the renewable sector, in particular, with a focus on solar energy since Narendra Modi became Prime Minister in 2014. In fact, the Indian Cabinet on Wednesday cleared the proposal to construct 10 indigenous pressurized heavy water nuclear reactors with a total capacity of 7,000 MW.
“A combination of strong government support and increasingly attractive economics has helped to push India into second place in the latest issue of our renewable energy country attractiveness index,” EY said in its report.
Over the years, India has steadily improved its ranking. From ninth in 2013, it reached the third spot in 2016. In terms of capacity, as of March 2017, the country has a combined renewable energy capacity of 57 GW and is aiming to raise it to 175GW in the next five years.
The competition from solar sector, which has seen a significant drop in tariff in recent months, affected pricing power of coal-based power plants.
“Movements in the index illustrate the influence of policy on renewable energy investment and development – both productive and detrimental. Supportive policy and a long-term vision are critical to achieving a clean energy future,” Ben Warren, chief editor, EY Global Power & Utilities Corporate Finance Leader, and Renewable energy country attractiveness index (RECAI), said in a statement