Vote: +7

"Hess,
There is a number of reasons, each one slightly different for each company.
For example Shell recently said it was selling its renewable division, not because it wasn't profitable, it is, but because it wanted to concentrate its investment on its core business which ahs a higher rate of return on investment than renewables.
EDF and E.on have been lobbying to lower the targets and each have withdrawn from big UK projects such as the London Array for a number of reasons, firstly theya re both involved with Nuclear which plays to their traditional strengths, secondly planning permission system in UK means that a large amount of money ahs to be up fronted before the company even knows whether it will be granted, also planning procedures take up to 3-5 years, too long for the corporate sector. Ontop of that renewables, such as wind, work best with a smart grid, the National Grid has been waiting for political approval to build one, so far that was promised last May, then delayed to Novemember, and they are still awaiting a result.
Government tax breaks and support in the UK is much lower than in say Spain, or Germany, which is a a big added factor.

But it is not just the energy company and the banks that upfront large chunks of the money understand traditional energy generation but are unsure about renewables mainly due to a lack of track record and sheer inexperience in the renewable investment field, so they charge a higher rate of interest on loans to renewable projects than to traditional ones, when they actually agree to lend money, which is of course in short supply and being gobbled up by other parts of the corprate sector that banks feel more comfortable with.

That is why the Governments of the world have to get behind renewables, providing loans, giving tax breaks, fast tracking planning permission, actually making decisions would be a start."

By: Natural Choices :: 2 years ago

Vote: +0

"Thank you natural Choices, I understand this much more then. But I still find some big inconsistencies between the government's pledge and how they facilitate the development of green energy. are we saying that the government is yet just spinning and playing on the high profile of such issues to be perceived as making the right decisions. By the way, i dont mean labour vs conservative. i dont think it's that simple. Let me have your views. by the way, you are not at all grumpy but you teach us through your wisdom."

By: Hess :: 2 years ago

Vote: +0

"The issue as I see it is that you have an internal contradiction in policy, on the one hand a civil service that understands the traditional way of doing business, and a new situation, in this case climate change, and the desire to build a low carbon economy. Politicians similarly have raised temselves through the ranks primarily by not rocking the boat. So you ahve a disconnect beween what they know should be done, like when they passed the Climate Change Bill in the UK last year, and what they do, Heathrow Expansion, Kingwood North.
On of the main reasons is that so much of UK Government policy pushes the cost and work onto the private sector, its the energy companies who are paying for insulating homes, like British Gas, it is the generators like EDF and E.on who are expected to fund the majority of renewable generators such as wind. This could be possible if the Government opened some major doors for them with tax breaks, speeded up planning permission, low interest, but commercial loans. this they are failing to do, not because the minister responsible, Ed Miliband, and before him Hilary Benn, are blocking it, they are all for it in various forms, but because they are actually powerless, against those departments that either control the money, the Treasury under Alisair Darling who say that 1 they don't have the money, 2 they are supporting the banks, car manufacturers,, or work with the business concerned under Peter Mandelson who see their role as supporting exisiting businesses not necessarily creating new industries. This isn't a left right thing either, The Conservatives, who went through a bit of a green revolution, at one time jokingly be called the Turbine Tories, equally are very weak on supporting greenenergy in hard policy terms."

By: Natural Choices :: 2 years ago

Vote: +0

"Natural choices: I think the govt will commit funds and tax breaks for projects that can demonstrate they are truly low carbon. Clearly some power companies were hoping to create a renewables energy division, make a big charade of being green and pocket huge govt subsidies from the political "green agenda". Thankfully for the tax payer the govt is not so thick. Clearly planting a handful of wind turbines and a huge coal station next to it as backup in case the wind is not blowing doesn't make commercial or environmental sense. And realistically that's the kind of issue one needs to address to make a valuable addition to the National Grid. We live in a free market and there're plenty of worthy causes but to move them forward they need to square with the realities of commercial viability. That's why organic food has become such a huge success -because it doesn't live out of ideology alone: prices are competitive.

I think there's a place for wind energy in Britain (and more so ocean energy) and you make a valid point about govt investment for research. Clean energy companies need to find the investors who'll bear the risks (and the future rewards) to move to the next level."

By: brunella :: 2 years ago

Vote: +0

"Brunella, sadly I don't think in the energy sector we are anything near a free market, if one actually exist anywhere. For years the nuclear industry has been heavily subsidised, and continues to be so, partly of course becasue it was necessary to provide the materials needed to make weapons of mass distructuction, and partly because the economics of decommissioning and disposal make the whole affair a commercial no go zone.

The UK governments idea was and is, that the big power companies would be the main drivers in investing in renewables, indeed it expected 85% of the investment necessary to reach the Renewable Energy Directive, and Climate Change Bill, to come from these companies. That is why it was so shocked when E.on and EDF essencially refused, as a few days later did Scottish Power.

And on the free market and why it doesn't exist in the fossil fuel/nuclear sector- can anyone explain to me why aviation fuels has no tax on it, and why airlines don't pay VAT on ticket sales, while railways do?"

By: Natural Choices :: 2 years ago

Vote: +0

"dont apologies for bad spelling. we will be implementing in future releases an edit comment facility. Tahnk you for being patient."

By: Hess :: 2 years ago

Vote: +0

"Brunella, I think you may have hit the nail on the head there."

By: Natural Choices :: 2 years ago

Vote: +0

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