UK’s Offshore Wind Needs Strong Government Action to Win Global Race

RenewableUK has welcomed a study by financial analysts Ernst and Young which puts Britain near the top of the list of countries in which to invest in renewable energy.

However, the trade association expressed disappointment that offshore wind is placed behind Germany in its level of attractiveness.

In Ernst and Young’s latest quarterly index, the UK is rated number two in the world as the best bet for investment in offshore wind, and is in fourth place for wind energy overall (onshore and offshore). RenewableUK warns that Britain is being kept off the top spot because the Government’s Energy Bill, published in November and currently going through Parliament, is creating uncertainty among investors.

Ernst and Young’s report warns that the Energy Bill “fell well short of expectations”, because it has yet to set the level of financial support that renewable technologies will attract under the new financial framework the Bill ushers in. Their study also expresses “disappointment” that a decision on setting a target date of 2030 to decarbonise the UK’s electricity supply has been deferred until 2016, as this is “still leaving investors with a sense of uncertainty”.

Renewable UK’s Deputy Chief Executive, Maf Smith, said:

“This report highlights the British wind industry’s strong track record, as we have maintained our leading position, despite challenging economic conditions worldwide, near the very top of the global table – especially in offshore wind, where we’ve installed more capacity that the rest of the world put together, and we’re already hosting two-thirds of European offshore construction. The main reason we are in second place rather than taking the top spot in Ernst and Young’s investor attractiveness index is that the Energy Bill is creating uncertainty among investors, so we need urgent clarity on the details of strike prices and a commitment to a 2030 decarbonisation target.

“Decisions by major manufacturers are being made imminently over where they place their factories for the Northern European roll-out of offshore wind. The UK, with the scale of our resource, is ideally placed to benefit from that and create 47,000 jobs in offshore wind alone by 2021, but this index shows it’s not a forgone conclusion that we will.

“The next few months are key for British ambition in winning the race to host these factories. We hope that the Chancellor George Osborne will use his budget speech next month to emphasise the fact that the British wind industry is very much open for business, and that we see a strong offshore wind industrial strategy from the Business Secretary Vince Cable to compliment this with a policy framework designed to ensure that investors know that the UK is the best place for them to be.”

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Press release, February 26, 2013; Image: London Array