by Trevor Loveday
Renewable energy companies this week raised the alarm over a 50 per cent slump in investment caused by “prolonged uncertainty in renewable power policy”.
The Renewable Energy Association (REA) said the government had yet to determine key details of how renewable power would be supported by its Electricity Market Reform (EMR) package. It cited a report from Bloomberg New Energy Finance showing that green energy investment activity had “dropped drastically” from a peak in 2009. “These figures illustrate that capital is voting with its feet,” said REA chairman Martin Wright.
According to Bloomberg, asset finance activity in UK clean generation fell by more than half between 2009 and 2011 (see graph) and third-quarter figures this year suggest a further drop. “Decc now needs to listen very carefully to what the renewable power industry is saying and not take final EMR decisions that expose renewable power to excessive risk and uncertainty,” said REA chief executive Gaynor Hartnell.
Decc rejected Bloomberg’s figures. “The UK attracted record investments in renewables, and thousands of new jobs as a result, in the last financial year,” said a Decc spokeswoman. “In 2011/12, £12.7 billion of investments were made.”
The REA warned of the “dangers of a serious investment hiatus” arising from the “prolonged” EMR process. The end of the Renewables Obligation in 2017 and “recent political disagreements” had unnerved investors, it said.
This article first appeared in Utility Week’s print edition of 30th November 2012.
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