THE Government's delay on announcing levels of financial support for renewable energy will put jobs and investment at risk, according to the North East's leading green power businesses.
A review of the subsidies under the Renewable Obligation Certificates (ROC) banding scheme – expected to include big cuts to funding – had been anticipated in spring.
But they are now not expected for months, although the Government has to announce the subsidy levels by September.
The North East’s renewables industry group, Energi Coast, called the delay “immensely damaging” for the industry and called on the Government to get moving. Its members, which include some of the region’s biggest firms, have already invested more than £400m in their renewables operations and currently employ in excess of 6,500 in the industry.
Alex Dawson, chairman of Energi Coast, said: “Further delays to a government announcement will have a negative effect on any potential investment in the offshore wind market.
“The Government continually talks about the UK manufacturing its way out of recession, however, it is failing to take advantage of one of the key sectors that has the skills and capabilities to drive that growth.
“The industry has done everything it can to prepare for the growth in the market: in the North East England alone, hundreds of millions have been invested by companies that have the products, skills and services to meet the requirements of offshore wind.
“These companies are already winning contracts in the sector and are demonstrating that the supply chain is poised for the next stage of development in the market.
“However, we cannot afford the continued impact government indecision is having on investor and developer confidence, otherwise the potential for an industry that can become a key part of both the UK energy mix and the country’s economy will be severely diminished.”
Leading North East chartered surveyors, H&H Land and Property, have added their concern to the delay over the review.
“This delay makes it hard for us to advise clients and leaves us second-guessing the regulatory system,” said renewable energy advisor Alastair Fell.
“We are currently doing due diligence for banks proposing to lend to installations of turbines that will be installed after the feed-in tariff cut, and neither the banks nor the landowners have any idea if the projects will be economically viable.”
The Department of Energy and Climate Change said: “We are committed to supporting renewables as part of our energy mix, and will continue to work hard to finalise the detail for the ROC subsidies at the earliest opportunity, but it is important to get the levels right and base these on evidence.
“The renewables sector is crucial for sustainable economic growth, supporting jobs up and down the country, attracting inward investment and helping us to reduce emissions in order to tackle climate change.”
Britain requires heavy investment in renewable energy to meet its target of generating 15% of its energy consumption from renewable sources by 2020.
There are already 3,000 turbines in the UK, with a further 4,500 planned. The industry is heavily funded by subsidies worth around £400m a year.