Policy risk makes Britain uncompetitive, MPs told

Uncertainty over energy policy is making Britain less competitive for investors, experts told a meeting of the Energy and Climate Change Committee (ECCC) today.

Andrew Lee, chief executive officer and managing director at Velocita Energy Developments, said: “Long term investment in the onshore wind sector in France and Germany is achieved at five, six per cent returns.

“In the UK we probably have to add two or three per cent on to that.”

Lee said the complex nature of Britain’s energy system made it easier for tariffs to be “salami sliced” off and extra costs loaded on.

Mathew Knight, director of energy strategy and government affairs at Siemens, said Britain should be the best place in the world to invest in energy: “We have the rule of law; we have access to the city; we have 25 years of privatisation; we have a whole load of other things going for the UK.”

However, he said the political system was holding the country back: “Europe tends to have coalitions. They’re a lot more consensual and technocratic about the way that they view energy policy.

“Here in the UK, for some reason, it’s a much more partisan thing”.

Knight called for the creation of a cross party long term plan: “A rolling forward view published every year by Decc, endorsed by the Treasury, endorsed by the National Infrastructure Commission, embraced by the whole industry that gave us the broad direction of travel; that would create more jobs in the supply chain than anything else.”

He also warned politicians to be more careful about how they express their opinions, saying he had “seen a thousand jobs killed by a speech”.

Speaking at ECCC meeting last month, industry experts demanded more clarity from the government on the future of CCS.