Financial consultants Ernst & Young have rated the UK as the fifth most popular country to invest in as a result of the Energy Bill which was passed in November according to their Renewable energy country attractiveness indices.

Britain’s rise to joint fifth with Spain has been attributed to recent legislation which specifically sets out provisions for the introduction of Feed-in tariffs by 2010. Feed-in tariffs are fundamental to investors as they guarantee a premium fixed rate for energy fed back into the national grid by small, renewable energy producers.

Also, acting as an important stimulus for investors is the falling value of Pound Sterling which is predicted to reach parity with the Euro in the new year.UK renewable projects increasingly expensive as imported technologies from Europe continue to rise as a result of the exchange rate.

“The falling value of the pound is making

“The declining price of oil is compounding the problem by reducing project revenues as wholesale energy prices fall, resulting in many projects becoming uneconomical. It is unlikely that falling commodity prices such as steel and copper will compensate enough” predicts Head of renewable energy at Ernst & Young, Jonathan Johns.

The recent Renewable energy country attractiveness indices saw Germany reach first position as a target for investors and is now seen as the leading light in terms of viable renewable energy innovations.

Germany added further credence to the Feed-in Tariff system at the Sydney Energy convention last month by asserting that their success in the renewable energy sector has been based on Government legislation there which promotes investment in renewables.

The payment of premium rates for energy supplied to the national grid by the German Government combined with decades of green issues being pushed to the fore in Scandinavia and northern Europe has seen Germany become a world leader in the field of Solar and Wind energy. This will certainly come as a boost to environmental groups in the UK where important government legislation, passed at the end of November will see the UK compete in this area by 2010.

In the UK a number of initiatives have been taken, including the installation of industrial wind turbines in public spaces such as supermarkets and petrol stations. It is widely believed that when more ‘solar-rich’ states such as Australia and South Africa put their weight behind the Feed-in Tariff system, there could be no limit to its success across the globe.

Britain‘s controversial Energy Bill was passed yesterday, signalling a significant move towards the use grid connected, renewable energy sources across the UK.

The new laws will see the UK cut gas emissions by 80 per cent by 2050 and open the door for feed in tariffs, with the Government paying owners of grid connected solar and wind systems a premium rate for the energy they produce.

Environmental groups and members of the renewable energy industry have warmly welcomed this new legislation. The Renewable Energy Association released the statement,

“The Renewable Energy Association is delighted that that government has recognised the advantages of a tariff-style incentive scheme which will open doors for small-scale producers of renewable heat, electricity and bio-methane,” Philip Wolfe, Director

It is generally accepted that the progressive feed-in tariff policies of European countries such as Germany, France and Spain have stimulated and accelerated the growth of renewable energies there.

The report, The Oil Crunch: Securing the UK’s energy future launched by Arup, FirstGroup, Foster + Partners, Scottish and Southern Energy, Solarcentury, Stagecoach Group, Virgin Group and Yahoo sets out a series of recommendations. The key warning in the report is that a peak in cheap, easily available oil production is likely to hit by 2013, posing a grave risk to the UK and world economy.

The report focuses on the need for the UK government to look towards alternative economic and environmental opportunities in order to combat the eventuality of Peak oil over the next decade. While Britain is certainly light years behind European states such as Germany in implementing practical energy legislation, the upcoming debate over the Energy Bill will undoubtedly open further debate into the need for the introduction of feed-in tariffs. In Germany they have proved a highly successful way of attracting investment into renewable energy production and some have predicted that German energy production could be one hundred per cent fossil fuel free by 2050. This would of course protect states such as Germany against any potential oil peaks over the next decades.

Currently the UK produces only five per cent of its energy by means of renewable sources compared to Germany with over fifty per cent. It is therefore considered essential that if the UK is to meet its green targets and perhaps more importantly, protect itself from the fluctuating and unsustainable fossil fuel market it is essential that the government heed the warnings set out by the Peak Oil and Energy Security Taskforce.