Isra-Mart srl : Energy industry demands carbon policy clarity

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Representatives from across the energy industry are this week expected to step up calls for the coalition to clarify its energy policy and deliver the stable regulatory framework necessary to encourage investment in low-carbon infrastructure.

Attendees at the Energy Solutions Expo in London tomorrow will be told that policy uncertainty surrounding measures such as the feed-in tariff and the planned Green Investment Bank is undermining investor confidence and delaying low-carbon energy projects.

Speaking at a roundtable event hosted by Energy Solutions ahead of the expo, Dr Victoria Johnson, head of the climate change and energy programme at the New Economics Foundation, warned that the "surest way to kill business interest in a topic is to have regulatory uncertainty".

Experts agreed that the inclusion of the proposed Green Investment Bank and the feed-in tariff incentive scheme in the coalition's spending review had prompted some businesses to question whether the government will continue to deliver policies that drive them to invest in low-carbon technologies.

"The problem is that some businesses have yet to be convinced that they will get the return they want from investing in green skills, because they have not got the policy certainty they need," said Caroline Doble, director of carbon services at consultancy Utilyx. "For example, businesses have trained and even employed people to handle compliance with the CRC, but now the government has signalled that it may change the CRC – businesses don't know whether that investment was worthwhile."

She added that government plans to simplify the CRC were "a positive step", but warned the coalition must be careful not to shift too many of its 'green' goalposts, "as this can make businesses wary of making green investment decisions".

A survey of 70 senior executives from across the energy industry carried out by Energy Solutions confirmed that there are widespread frustrations at uncertainty currently surrounding the policy landscape.

Almost 80 per cent of respondents said that they felt the government was not doing enough to safeguard the future of the UK energy sector, while 62 per cent felt the coalition was not doing enough to support domestic energy innovation.