A report aimed at investors with some pertinent things to say on UK energy policy...
In this note we conclude that:
1) EU policy makers have grossly underestimated the difficulties and risks of their drive to decarbonise the power sector.
2) EU policy makers have failed to take into account the huge changes in the economic, commodity and financial environments and adjust policy accordingly.
3) The economic arguments supporting the current climate change dominated energy policy look weak and public support is uncertain.
4) Given the hostile rhetoric that utility companies face today from across the political spectrum on bills and profits, it takes quite a leap of faith to believe that future governments will steadfastly defend the huge bill and profit increases that will inevitably result from current policy.
5) Political risk is bound to rise sharply in the UK energy space in the coming years as the inherent implausibility and contradictory nature of the policy goals are exposed by events.
6) A crisis in UK energy policy looks increasingly likely and therefore utility
companies and investors would be prudent in limiting their future exposure."
This report does not come up with the answers; it is up to engineers and entrepreneurs to do that, once the government eventually decides to get out of the way and abandon its policy of creating ordered queues of specialist subsidy farmers in Whitehall.