Following ‘energygate’; the windfarms row between John Hayes and Ed Davey; Head of the Committee on Climate Change John Gummer’s remarks; the energy bills row; and energy companies’ threats to withdraw hundreds of millions of pounds of investment - all of which occured in the last month – the chairman of the energy select committee, Tim Yeo, has hit out at the coalition’s energy policy.
He tells today’s Telegraph confusion over energy policy looks “like a laughable plot line from The Thick of It”, warning it risks increasing consumer bills and deterring investors.
“The problem is, the pension funds and investors we need to build new energy infrastructure in the UK are not finding it very funny. The more uncertainty there is about energy policy, the higher the perceived risk will be for investors.
“This will push up the cost of capital, increasing electricity prices and potentially undermining our energy security if projects are pulled as a result.”
Renewables UK’s Maf Smith, writing in the Staggers today, points out the “chorus from business” for “certainty on energy policy and low carbon investment” is now deafening:
The case being put forward by businesses, who are ready to make once in a generation investments into our economy, is based upon evidence and global trends. But we run the risk that these investments could be delayed. They hinge on the agreement of the UK government’s ministerial “Quad” – David Cameron, Nick Clegg, George Osborne and Danny Alexander – who are apparently set to meet to discuss energy policy.
Over the autumn, business opinion has got firmly behind the view that our electricity sector needs to decarbonise. Such a shift will protect us against future price rises, open up investment in new technology and manufacturing, and support a new cornerstone of our economy – the green economy – which alone has delivered a third of the UK’s total growth in the last year.
Sometimes business opinion settles on a realisation that future prosperity lies in a particular direction. Sometimes it is important that Government can agree that too, that’s why this energy bill is crucial for the sector.
As Left Foot Forward reported in October, seven major energy companies employing 17,500 workers in Britain are threatening to withdraw hundreds of millions of pounds of investment because of a lack of decision making and attempts to downgrade green targets.
Investors need certainty, that much is clear – and it is the duty of this government to provide that certainty, and, though not picking winners, should pick sectors, and place green growth at the heart of the recovery.
Greenpeace have attacked David Cameron’s failure to mention “energy” at all in his speech to the CBI today.
Executive director John Sauven said:
“In addressing the CBI, the prime minister failed to mention “energy” once. It has become the elephant in the board room, as decisions made by his government on energy in coming months will underpin the UK’s economic performance for decades to come.
“The green economy contributed one third of all UK growth in the last year – it’s time for David Cameron to stop pandering to the extreme anti-environment wing of his party and stand up for green growth and jobs.
“The coalition government’s energy policy might be a total shambles, but the longer the prime minister fails to step in and sort out the mess, the higher the price consumers and industry will pay.”