Wednesday, 10 October 2012

‘Go green or we quit’ energy chiefs tell Davey

Seven electricity and nuclear technology firms have written to the Energy Secretary Edward Davey, warning that unless government steps up its green commitments, they will withdraw all plans for any future investment in the low-carbon energy sector in Britain.

The letter – copied to Prime Minister David Cameron and Chancellor of the Exchequer George Osborne and leaked to The Times newspaper – is the front-page subject of today’s (8 October) Times newspaper (UK edition), and warns that the UK will only continue to see ‘significant further investment’ in low-carbon energy generation if the government can ‘ensure high levels of confidence’ in its green commitments.

The companies behind the letter, which collectively employ 17,500 people in the energy sector and represent ‘low carbon power generation equipment and associated services’, are Siemens, Areva, Doosan, Gamesa, Vestas, Alstom UK and Mitsubishi Power Systems.

According to the signatories, recent delays in green policies and reported ‘disagreements in government’ over the RO banding have caused them to ‘reassess the level of political risk in the UK’ and could prevent them from further investing in the country, potentially costing the country tens of thousands of new jobs and millions of pounds.

‘Historically, the UK has benefited from being known as a country with low political risk for energy sector investments’, reads the letter, continuing: ‘…undermining that reputation would have damaging consequences for the scale of future investments in the UK energy sector.’

The letter, strategically leaked during the Conservative conference, concludes by calling for a ‘binding’ 2030 target for power sector decarbonisation in the upcoming Energy Bill to reduce political risk and build alliances and supply chain relationships ‘required for cost reduction and opportunities for local content’.

Letter from 50 organisations

Also released today is an open letter from over 50 businesses and organisations calling on George Osborne to set a 2030 decarbonisation target and move away from any heavy reliance on gas-fuelled electricity.

Co-ordinated by the Aldersgate Group, an alliance of ‘leaders from business, politics and society that drives action for a sustainable economy’, and signed by major companies including Biffa, EDF Energy and Veolia, the letter does not specify a particular target level, but urges for a target to be put in place in the upcoming Energy Bill.

‘The government's perceived commitment to the low carbon transition is being undermined by recent statements calling for unabated gas in the power sector beyond 2030 and the absence of a specific carbon intensity target’, reads the letter.

‘It is essential for government to provide investors with the long-term confidence they need to transform our electricity market and make investments capable of driving wider economic growth.

‘Failure to act at sufficient scale and pace will undermine our prosperity and cause us to miss out on the huge commercial opportunities associated with the global shift to a low carbon, resource efficient economy.’

The letter goes on to warn the chancellor that continued support for gas power would undermine investment in UK electricity infrastructure.

Several calls for a clear power decarbonisation target have been made recently, after Labour Leader Ed Miliband and the independent Committee on Climate Change (CCC) publically urged the Energy Secretary to fulfil the coalition government’s promise to be the ‘greenest government ever’ and commit to a 2030 power decarbonisation goal.

See The Times for the full letter.

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