Carbon Diary: 15% is what is says on the tin
Our seas are a massive, renewable energy resource. The newly-formed RenewableUK (formerly BWEA) found a new focus yesterday in calling on Government to invest a further £150-£200 million in two renewable technologies – wave and tidal energy. Companies like Siemens and Vattenfall are keen to invest in wave and tidal power, in places like the Pentland Firth. The driver here, surely, is the Government’s high level commitment to get 15% of our total energy from renewables by 2020. This means generating a third of our electricity supply from technology that only now being developed and built.
Are we investing enough to develop the technology and employment opportunities that go with it? No – despite the Government’s £60million backing of wave and tidal R&D in recent years.
The funds RenewableUK wants represent a small first slice of the £200 billion that Ofgem’s energy review (Project Discovery) called for, to replace “large parts of our ageing energy infrastructure”. This includes investment in riskier activities, the so-called “emerging commercial renewable energy”, like wave and tidal power and the massive new offshore wind turbines.
RenewableUK wants a new state-backed finance institution to ensure sufficient capital flows to the renewable energy sector. We’d agree with that. But these investments are long-term. That’s why long-term, cross-party backing for our renewable targets, such as the Secretary of State is calling for, is essential. It creates confidence – not just for investors, but for anyone looking for a quality, skilled work. As Kirsty Hamilton said in her Chatham House study recently:
“In a policy-driven market the policy and regulatory environment itself is a risk. A change in government, or a change in economic or public expectations, can result in policy changes over which the investor or lender has no control, but which negatively affect or even wipe out expected returns.”