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Crisis hits renewables target

Britain’s alternative energy strategy is in total crisis, with the former boss of BP saying that only urgent government intervention can force the market to deliver the wind and wave developments needed to meet renewables targets.

Shell and BP have pulled out of UK offshore wind farms entirely; Shell’s withdrawal was a real blow, as it was committed to investing in the world’s biggest offshore wind farm, off the Kent cost.

But the government is not planning any intervention. In fact, the exact opposite is happening. This week, grants for supporting alternative energy projects in schools and hospitals finished, and are not being replaced. The most effective way of reducing emissions would be to subsidise super-insulation of homes – but there is less subsidy now than there was ten years ago.

Speaking at the premiere of the new climate change movie “The Age of Stupid”, energy and climate change secretary Ed Miliband avoided all these issues, instead making a heartfelt call for citizens to stop opposing wind farms – as if that was the problem.

Miliband knows that on-shore wind farms alone cannot deliver government renewables targets and the problem facing them is not local opposition, but unprofitability. The cost of imported equipment has risen; the price of energy has fallen, and the cost of borrowing to finance them is too high. The only company in the UK making wind turbines has had to be bailed out by the Scottish government.

Global energy company E-on has warned Miliband he will have to revise targets for the contribution of renewables downwards. This absolute failure of the market will be highlighted by BP’s former boss Lord Brown of Madingley when he bluntly tells a conference in Cardiff tonight that the competitive market cannot deliver and the government must urgently take greater control of energy markets.

But since every available scrap of government subsidy has been poured into the black hole of the banks, there is definitely nothing left to rescue alternative energy. With the latest government bond issue failing to sell out, for the first time in many years, there is simply no more cash.

As a result, Britain is now poised to resume its 19th and 20th century position as the polluter of Europe. The only new energy projects that are truly on the cards are new coal-fired power stations and possibly, nuclear.

A new report from the Tyndall Centre for Climate Change research says that far from revising any targets downwards, the government should be aiming for a 42% reduction in emissions by 2020 – and that must be real cuts, not offsets bought in from outside the UK.

And it adds that ALL policy decisions should fit in with achieving no more than 2ºC of global warming – ie. carbon-intensive infrastructure plans, such as additional airport capacity, new coal stations or major road building, should be ruled out if they contribute to higher emissions.

But in reality, the New Labour government is driving us at high speed – in a big gas-guzzling four-wheel drive – over the edge of the 2ºC cliff. We need to stop relying on BOTH the market system AND failed appeals for government action and subsidies. To slam on the brakes we need to opt instead for a sustainable, democratically-controlled, decentralised system for both saving and providing energy.

Penny Cole
Environment editor
26 March 2009

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