Political uncertainties risk derailing UK's energy strategy, finds report
Britain's progression towards a low-carbon economy is being hampered by political uncertainties surrounding recent energy price hikes, the impact of the recession and on-going concerns about energy security.
That's according to a new report from the UK Energy Research Centre (UKERC), which identifies the various obstacles facing the nation's low-carbon ambitions.
The Report, entitled 'UK Energy Strategies Under Uncertainty', features contributions from over 30 of Britain's leading academic experts on energy. Read the full report here.
"For the last decade, energy policy in the UK has been an increasingly delicate balancing act between reducing emissions, security and affordability," said Professor Jim Watson, the UKERC's research director.
"Policymakers are right to be sensitive to the financial pressures facing the public and businesses, but action to relieve these pressures shouldn't come at the cost of progress towards a low-carbon economy.
"Current uncertainties about the direction of UK energy policy run the very real risk of making energy less affordable, less secure and less sustainable in the long-term."
The UKERC report explores the key factors that are likely to affect the achievement of emissions reductions across the energy system; from the adoption of electric vehicles to the transformation of heat networks and the flow of finance for low carbon power stations.
It recommends that the government should expand energy efficiency programmes, particularly for the use of heat in buildings. It also points out that concerns of an investment gap are 'overstated' - there is no shortage of capital, but changes to policy frameworks, market structures and business models may be required to attract that capital to the UK power sector, it says.
Dr Rob Gross, director of the Centre for Energy Policy and Technology at Imperial College London and a co-author of the report, said: "Raising the billions of pounds needed to fund the UK's transition to a low-carbon economy will be challenging, but is achievable.
"Most low-carbon projects rely heavily on existing utility companies for funding, but these companies are facing multiple pressures on balance sheets and a key challenge for policymakers is to create the conditions that either allow utilities to raise the finance needed by themselves or permit new forms of project finance, in order to attract sources of international capital into the sector."
The report concludes that more attention should be paid to public concerns about the structure of the energy market and who should pay for new investments that need to be made. It explains that this could persuade the public to accept less desirable aspects of system change - such as continued fossil fuel use - if there is confidence that the full range of concerns are being considered.