stimulating private investment
The Government must provide long term certainty for investors by guaranteeing the procurement of
renewable energy. That will make it easier for the private sector to raise the funds for investment.
transition to the low carbon state pre- private sector capital would always have term certainty for investors by guaran-
scribed for 2020. played a major role in those initiatives. teeing the procurement of renewable
The recession has forced both the energy. That will make it easier for the
Development on two fronts
sources of capital and the companies private sector to raise the funds for in-
able to bring those projects to fruition to vestment.”
Two vital areas were identified by Greg re-think their investment strategies. In- Private sector attitudes to investment
Barker as the need to transform the age- vestment is on hold or running at a re- in renewable energy sources are col-
ing National Grid into a 21
st
Century duced rate. oured only in part by the shortage of funds
Smart Grid, and the laying of the founda- With the 2020 deadline for reducing available for the purpose. The financial
tions of an ambitious offshore network of energy consumption by 20% unchanged, crisis has been changing fundamentally
wet marine and offshore wind facilities. it follows that if significant amounts of the way in which investments are as-
“It will create marine parks that will investment are delayed until after the sessed. “The funding model for renew-
stimulate the entrepreneurial develop- recession, the same targets have to be ables is changing so that investors will
ment of the energy resource off our coast- met but within a shorter timescale. be prepared to accept lower returns and
line, and benefit our economy as a financial risk in exchange for greater
whole.”
Other aspects of Government climate
Impact of the recession
certainty into the longer term: their hori-
zons are extending outwards.
change policy have their own shortcom- Does Greg Barker see the recession as “The Government is uniquely placed
ings according to Mr Barker. having an impact upon the development to partner with the private sector and pro-
“There has been no strategic push be- of the renewable sector, rather than just vide the security it needs by offering
hind the development of a decentralised delaying the underlying investment? longer term contracts and greater cer-
energy generating system with strong in- He draws on the evidence to hand. tainty of the policy regime in which in-
centives and clear regulation to promote “Major manufacturers such as Siemens vestments will be made. In the post
the uptake of micro-generation, and de- and Vestas are reporting falling sales of credit-crunch period, the downside pro-
centralised generation by businesses.” renewable technologies, while UBS has tection which results from that relation-
published a survey on investment in the ship will prove a larger factor in private
Private sector investment
sector which confirms the slowdown in sector decision-making processes than
the rate of new investment there. pursuing the greatest return at all costs.”
It has never been the intention of the Gov- “It is a very difficult time for renew- It is difficult to review any political
ernment that the development of renew- ables, making it all the more important strategy on energy and climate change
able energy technologies should be for Government to ensure that the public without reference to Renewable Obliga-
funded significantly by the Exchequer: sector plays its part. It must provide long tion Certificates (ROCs). For the record,
The Informed Executive
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