UK Governments have succeeded on renewables but failed on energy security, say business leaders

British energy policy since the turn of the century has been successful in increasing the use of renewables and reducing carbon, but has failed on delivering secure and competitively-priced energy, a poll of nearly 1,000 business directors has found.

The poll of 998 directors, conducted by the Institute of Directors (IoD), reveals that Britain’s business leaders believe UK green policy to have been successful in increasing the use of renewable energy sources (59% agreed) and reducing carbon emissions (45% agreed), since Tony Blaire’s Labour Government first pivoted in that direction in 2002.

However, seven in 10 of the directors believe the Labour, Coalition and Conservative administrations have all failed to make energy available at a reasonable cost. Two-thirds also complained that politicians had not succeeded in ensuring the UK would always have the power it needs.

The IoD’s senior infrastructure adviser Dan Lewis said: “Since the early 2000s, government of all stripes have focussed on increasing use of renewable energy in order to reduce carbon emissions. 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 [BEIS], now is the ideal moment for the Government to reconsider the direction of travel. “

When asked about Britain’s future energy mix, the majority of business directors support all mainstream forms of renewable power generation, although the most popular – wave and tidal – is still largely untested in the UK. Interestingly, more than half (51%) of the 998 respondents also support fracking of shale rock for oil and gas as a way of extracting UK-based hydrocarbon resources.

While IoD members have consistently supported building new nuclear power plants, business leaders are seemingly mixed on the highly-controversial Hinkley Point C project, which the Government is now considering before making a final decision. A narrow majority (53%) of the IoD’s poll respondents believe Hinkley still makes strategic sense, but just 37% think Hinkley will actually make the UK more economically competitive.  

“Government policy at the moment is creating all sorts of bizarre outcomes,” added Lewis. “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.

“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 five million homes, but given the costs, the Government is right to take one final look before signing off on the deal.”

BEIS response

Responding to the survey’s findings, a spokesperson for the Government’s newly-formed Department of Business, Energy & Industrial Strategy (BEIS) said: “This Government is delivering on its priority to provide secure, clean and affordable energy.

“It is important that we are not reliant on one type of energy so we will combine offshore wind projects with fracking, nuclear and gas to provide families and businesses with the reliable energy they need. 

“And we’re helping consumers take control of their energy use and lower their bills with smart meters.”

BEIS recently unveiled its full list of ministerial responsibilities after replacing DECC in Prime Minister Theresa May’s Government reshuffle. But the majority of large business energy users fear that the recent removal of DECC leaves climate change swept under the rug.

According to one recent survey of 50 large, energy-intensive firms, 56% of respondents are particularly concerned about the removal of a department focused solely on energy.

The House of Commons is currently in summer recess and returns on 5 September.

Luke Nicholls

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