Government support and consumer acceptance support the industry
London, United Kingdom (PRWEB) February 28, 2013
The world's energy crisis has necessitated a radical shift among policy makers and industry participants of the Renewable Energy industry. Increased awareness surrounding the impacts of climate change has driven an aggressive decarbonising strategy. Renewable sources provided 9.4% of the electricity generated in the United Kingdom in 2011, representing a significant increase from 1.5% in 2006. The UK Renewables Obligation plan set out clear objectives that aimed to generate 15% of the country's energy from renewable sources by 2020. This has prompted a wave of investment in renewable technologies, particularly of wind energy, and led to dramatic increases in installed capacity and overall industry revenue. The UK's abundance of natural resources has boded well for industry operators, as the economic benefits of renewable generation were coming to fruition. This led to significant growth in employment opportunities as evidenced by the 14.9% compound annual growth over the past five years. According to IBISWorld industry analyst Lewis Sutton, “the dismal economic climate did little to temper consumer uptake of renewable energy, further incentivised through the feed-in-tariffs plan that rewarded households for generating their own renewable electricity”. In the five years through 2012-13, industry revenue is expected to grow at a compound annual rate of 6.5% to £4.92 billion, increasing 2.8% in 2012-13.
The future of the industry is inextricably linked to the level of government support and the willingness of consumers to bear higher costs. Funding and investment are critical to the industry if the United Kingdom is to achieve its 2020 target and not continue to lag behind its EU counterparts. Issues such as grid connectivity, skilled labour shortages and other process-oriented shortcomings must be resolved in order to ensure a profitable and smooth transition to renewable energy. Sutton adds, “while wind power will continue to lead the way, other sources such as hydropower, biomass and tidal energy also present strong opportunities for growth”. Prioritising access to renewable energy can advance social and economic progress in the long term, as it has the ability to strike the elusive balance between profitability and sustainability. In the five years through 2017-18, industry revenue is expected to continue to increase strongly.
The Renewable Energy industry has a low level of market share concentration with the top three players expected to account for less than 40% of the market. Major companies include SSE, E.ON UK and Iberdrola SA.
For more information on the Renewable Energy industry, including latest industry trends, statistics, analysis and market share information, purchase the full report from IBISWorld, the nation’s largest publisher of industry research.
IBISWorld industry Report Key Topics
This industry comprises establishments that generate energy from renewable natural resources such as sunlight, wind, tides and geothermal heat. It only includes the generation of energy from sources that are inexhaustible and can be replenished indefinitely, unlike fossil fuels such as coal. This industry does not include transmission and distribution of renewable energy.
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Globalisation & Trade
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