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United Kingdom

United Kingdom

We never wanted every project to succeed - Davey

UK: "We never envisaged or indeed wanted every project to succeed. Setting a budget forces an ever greater focus on cost." The words were from UK energy minister Ed Davey, speaking at RenewableUK's annual conference about the UK's offshore project pipeline.

Ed Davey delivers his speech to the RenewableUK conference in Manchester
Ed Davey delivers his speech to the RenewableUK conference in Manchester

It comes after a difficult year for offshore for, although the UK has around 4GW of installed capacity, projects worth more than double that have been cancelled over the last year.

Davey said the budget set for the Contracts for Difference subsidy programme will create a focus on costs and will drive competition, adding some projects were bound to fail. He said there had to be a limit for tax payer support for low carbon industries.

"For some in the industry, that early introduction of competition has been scary. Newspapers may write about offshore wind projects being dropped as if something is going wrong," he said.

The yearly budget had been criticised by many in the industry for being too low, including RenewableUK. It said the £235 million (EUR 297 million) to be used to subsidise less established technologies, like offshore wind, would only support up to 800MW of new capacity each year.

Politics

Davey used his presence at the event to apply some pressure to his party's coalition partners in the Conservative party. He reiterated the point that the Conservatives are largely opposed to onshore wind, despite much of the pipeline and installed capacity set for Scotland. His comments could also serve as a reminder that there is an election next year and Davey's Liberal Democrats are strugglng badly in the polls. 

"There are worrying signs this Tory hostility to onshore wind is threatening to solar too. Which renewable will be next? Will it be offshore wind?

"We all know the Conservative Party is in a collective panic over the UK independence party. But for a party of government that seeks to govern again that’s not nearly good enough. You can’t treat a business like that, you can’t treat an industry like that and you can’t treat Britain’s economic future like that."

Announcements

There were some constructive points. During his keynote address, Ed Davey said the industry needed to do more in getting the postitive message about renewable energies made more public."How many people outside this hall know that onshore wind is the cheapest large-scale renewable? And that onshore wind is set to be even more cost-competitive by the end of the decade," Davey said.

The energy secretary also made several announcements at the conference. He revealed MHI-Vestas’ plans to invest £200 million into the UK and to set up a blade manufacturing facility on the Isle of Wight by leasing Vestas’ facility there.

He also publicised the findings of a review, commissioned by the Offshore Wind Industry Council, into the UK offshore supply chain. It calls for greater transparency in the order pipeline and more collaboration in the sector.

Davey also announced the publication of a guide by UK Trade and Investment for investors explaining opportunities in the UK’s offshore wind sector. And he launched RenewableUK’s Faces of Wind Energy campaign demonstrating real life stories in the UK’s wind industry in a bid to encourage people into the sector.

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