Massive investment in clean energy projects has propelled China to the number one spot in a report ranking the world's most attractive locations for renewable energy investment.
Ernst & Young's Renewable Energy Country Attractiveness Indices ranked China and the US in equal first position as the most attractive countries for renewables investment - with China climbing from second place.
The US retained its top spot despite jitters surrounding its proposed climate and clean energy bill.
China's catch up was driven by the $34.6 billion it spent on clean energy projects last year and its increasing commitment to wind energy. The report said Chinese investment in clean energy projects in 2009 was almost double that in the US.
Ernst & Young environment and energy infrastructure advisory leader, Ben Warren, said: "China's consistently strong performance underlines its determination to robustly align energy and industrial policy, as it seeks to build a dominant position in the global market for technology manufacture and supply."
In 2009, China increased its environmental protection spending by 20% and is poised to release a draft 10-year clean energy plan. The report said such developments signal its commitment to a low-carbon economy.
Corporate developments such as the $1.5 billion five year investment in Chinese renewables by Hong Kong-listed China Resources Power Holdings also served to boost China's rating.
The indexes rate jurisdictions based on national renewable energy markets, renewable energy infrastructure and their suitability for individual technologies.
Below the US and China, the May 2010 All Renewables index saw Germany retain its spot in third place, India in fourth and Italy in fifth. The UK jumped one place to share fifth position and France climbed one spot to seventh place.
India benefited from more than $1 billion in government investment in the green economy, including recently announced solar and wind energy plans.
The UK was boosted by government plans for a £2 billion ($3 billion) green investment bank fund and recent approvals for electricity network upgrades.
Worsening capital markets and downward credit rating revisions saw small drops by Greece, Spain and Portugal, while Australia's fall from eleventh to twelfth place was attributed to setbacks surrounding its planned emission trading scheme.
By. Charlotte Dudley
Source: Environmental Finance
Charlotte is a writer for Environmental Finance.Environmental Finance is the leading global publication covering the ever-increasing impact of environmental issues on the lending, insurance, investment… More