New report says government failing green energy industry, backs Green Party policy
15 October 2008
News from the Green Party | www.greenparty.org.uk
For immediate release, 16 October 2008
NEW REPORT SAYS GOVERNMENT FAILING GREEN ENERGY INDUSTRY, BACKS GREEN PARTY POLICY
A new research report has concluded that government inertia is harming the UK's renewable energy industry.
'European Renewable Electricity Sector 2008: A Country Comparison of Risks and Opportunities', published by economic consultants London Research International, concludes that the Green Party's policy would create the best investment prospects for the development of renewable energy in the UK.
The authors report that the Green policy of feed-in tariffs (FITs), which is in force in some other EU countries, has 'been more effective at increasing renewable electricity generation than other schemes', while the UK government's approach of 'Renewable Obligation Certificates' is the least beneficial to the green energy sector.
The Green Party's preferred policy of feed-in tariffs works by obliging electricity companies to pay premium prices to generators of renewable energy and creating a long-term stable market for green energy. This makes investing in both large and small green energy projects more viable.
Renewables policy has, up to now, been run by the Department of Business Enterprise and Regulatory Reform, but will now be run by the new department of Energy and Climate Change.
Green Deputy Leader, Adrian Ramsay, said today:
"The UK could be a world leader in the young, clean and cutting-edge renewable energy industry. We are better placed than anywhere else in Europe to access this source of power, but are failing badly to realise our potential.
"This research confirms what the Green Party and the green energy industry have been saying for a long time: that the UK needs to create a much more stable and encouraging climate for renewable energy development.
"By continuing to pursue the failing Renewables Obligation, the government is failing this vital sector of the future economy. As today's research shows, guaranteed premium prices via feed-in tariffs are the way forward for all but the most established renewable technologies.
"Creating the right conditions for large-scale investment in green energy are just part of the Green New Deal the UK needs. We also need to back investment funds and loan schemes like those brought in by Green Councillors in Huddersfield, where homes and community buildings generate five per cent of the UK's solar electricity."
Caroline Lucas, Green Party Leader, commenting on Ed Miliband's appointment as the new Energy an Climate Change Secretary, added:
"If Miliband is going to make a success of his historic appointment to cabinet as the first climate change secretary of state, then he has to be straight with us, and straight with cabinet.
"He has to get through to his colleagues that business as usual is not only environmental suicide, but also economically unviable. We will not survive in the economy of the future without a world-class renewable energy sector, and Labour's attempts to avoid attracting one do no-one any favours.
"Strong policies which sufficiently incentivise wind power, for example, could result in an avoided fuel cost of €20.5 billion across the EU alone by 2020, and provide over 500,000 jobs."
The Greens' energy proposals were published in September 2007[1] and were submitted to the government's energy review. The resulting consultation continued to stress the government's reluctance to adopt a feed-in policy and proposed keeping the Renewables Obligation. The consulation closed on 26 September this year, and the Greens again submitted proposals for a feed-in tariff to be introduced [2]
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Notes:
1. The Green Party's report 'Greenprint for a renewable energy policy that works' was published in September 2007 and can be downloaded from our website here: http://www.greenparty.org.uk/files/reports/2007/1UKEnergyPolicyInDisarray_2.pdf
It concluded that the government urgently needed to bring in:
- the phased introduction of feed-in tariffs
- improved grants and loans to support investment
- new policies to aid renewable energy planning
2. The Green Party response to the latest Renewable Energy policy consultation can be downloaded at: http://www.greenparty.org.uk/assets/files/reports/RenewableEnergyConsultation2008GreenPartyResponse.pdf
3. Copy of press release from London Research International:
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London Research International
FOR IMMEDIATE RELEASE
UK's Investment Environment for Renewable Electricity Lags behind Other Major EU Countries
London, United Kingdom, Thursday, 16 October, 2008 - According to new research, The European Renewable Electricity Sector 2008: A Country Comparison of Risks and Opportunities, published by London Research International (LRI), the UK government is lagging behind other EU countries in providing a positive environment for investing in renewable electricity - despite a clear indication of failure to fulfil its commitment of attaining 10 per cent of electricity consumption from renewable energy sources by 2010.
LRI has developed a series of indices that provide a detailed rating of all of the key areas related to investing in the renewable electricity sectors of 15 EU member states. The research is unique in its use of multiple measures to develop five indices, which accurately and numerically evaluate the risks and opportunities of each member state's renewable electricity sector. A sixth non-numeric index provides an analysis of the emerging and established technologies that are currently adequately supported through government incentives or have the potential for growth. The opportunity indices measure government incentives and power market demand and also review established/emerging technologies in the sector. The risk indices measure political will, grid connection problems and planning permission challenges.
While the UK has a relatively high power market opportunities index, its risk indices are also high in comparison to other large EU member states. The UK's incentive opportunities index is low due to its use of the tradable green certificate (TGC) incentive system called the Renewables Obligation. The European Commission has suggested that countries that have opted for the feed-in tariff (FIT) have been more effective at increasing renewable electricity generation than other schemes, including the TGC.
Planning permission is a notable problem. The UK has a high-risk index for planning permission. This implies that, while the potential exists for renewable energy development, the UK government has been slow in providing an environment suitable for the required investment by failing to improve the planning permission process. The UK's political will risk index is also higher than that of the other large EU states of France, Germany and Spain. On the whole, the UK's renewable energy development programme seems to lack the coherence evident in other large EU member states.
Teruhiko Tsumura or Richard Carlson
London Research International Ltd, Elizabeth House, 39 York Road, London SE1 7NQ, UK
Tel: +44 (0)20 7378 7300, Fax: +44 (0)20 7183 1899
Email: t.tsumura@LondonResearchInternational.com
www.LondonResearchInternational.com
Registered at London Research International Ltd., No. 5004849 (England and Wales)
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4. The Green New Deal Group's first report - co-authored by Caroline Lucas - is available from www.neweconomics.org
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