Governments of ‘all stripes’ have failed on energy, say businesses

Governments of “all stripes” have failed to provide secure, affordable energy, a poll of business leaders has found.

Almost 68 per cent of the nearly 1000 bosses surveyed said the governments of the 21st century – whether Labour, Coalition or Tory – had failed to deliver “competitively priced energy”. A mere 10 per cent said they had.

More than 62 per cent complained that politicians had not succeeded in ensuring a secure supply of power, and less than 15 per cent said otherwise. The Institute of Directors, which carried out the poll, described the findings as “damning”.

“Since the early 2000s, governments of all stripes have focussed on increasing the use of renewable energy in order to reduce carbon emissions,” said senior infrastructure policy adviser Dan Lewis. 

“Cutting CO2 is overwhelmingly supported by business, but politicians have underplayed the other two crucial aims of energy policy, delivering secure and affordable power. Following the creation of the new business and energy department, now is the ideal moment for the government to reconsider the direction of travel.”

Very nearly three quarters those surveyed said the UK needed to decarbonise its power sector to tackle climate change, and only 16 per cent disagreed. Almost 59 per cent said energy policy has succeeded in increasing renewables, although just 45 per cent said the same with regards to reducing carbon emissions.

The most widely supported renewable technologies were wave and tidal (88 per cent) and solar (87 per cent). Only onshore wind received much in the way of opposition (34 per cent).

The poll found business leaders were broadly in favour of shale gas extraction. Roughly 56 per cent said they supported it and around 28 per cent said they were against it.

“The UK has the world’s highest offshore wind capacity, with much more expected. But technology based on the weather doesn’t work all of the time, so the UK needs a mix of renewables, nuclear and the cleanest hydrocarbons,” said Lewis.

“Government policy at the moment is creating all sorts of bizarre outcomes. Instead of accelerating moves to safely frack for gas and oil in the UK, we are importing coal and oil from Russia and gas and oil from Norway, with the extra costs and emissions that involves.

“Instead of building cleaner gas plants to meet demand when renewables can’t, the government has been subsidising more polluting diesel-fired plants.”

On the topic of Hinkley Point C, more than 53 per cent of respondents said the new nuclear plant in Somerset would improve the UK’s security of supply, compared to 31 per cent who said the opposite. Just over 38 per cent said it would make Britain more competitive, whilst almost 32 said it would make the country less so.

Lewis added: “The IoD backs nuclear as a reliable source of low-carbon energy, but each project has to make economic sense. Hinkley Point C would generate reliable power for 5 million homes, but given the costs, the government is right to take one final look before signing off on the deal.”

Earlier this week the boss of big six supplier SSE said the significant of Hinkley to the UK’s energy supplies had been “overplayed” and that the government needed to focus on “maintaining confidence” in the current policy framework.