Britain has slipped to fifth place in accountancy firm EY’s Renewable Energy Country Attractiveness Index (RECAI) following “political infighting and mixed policy measures”.
The United States remained at the top of the league table, but China closed the gap after installing a record-breaking 12GW of solar capacity in 2013.
Japan overtook the UK to take fourth place in the index thanks to “rapid solar market growth and a burgeoning offshore sector”.
However, a number of Spanish and Japanese banks are understood to be actively looking at investments in Scottish wind-parcs.
Germany stayed in third place but became less attractive following the announcement of “subsidy cuts and watered-down renewables targets by the new coalition government”.
Overall, there was an 11% year-on-year dip in global investment in renewable energy projects during 2013.
Dr Nina Skorupska, Chief Executive, Renewable Energy Association – the largest renewables trade body in the UK – commented: “It is not surprising to see the UK slip a place in the rankings.
“Investors are already looking at projects post-2020 but they have no clear steer from the European Union or the UK Government that they see a major role for renewables once the existing 2020 targets are met.
“Setting binding renewables targets for Member States will boost investor confidence, bring down capital costs faster and create jobs for British businesses.”