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UK Gov - 'Sorry we're broke - funding the Low Carbon Economy'
Written by Hugh Sharman   
Tuesday, 01 March 2011
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David Porter became Chief Executive of the UK Association of Electricity Producers (http://www.aepuk.com/ ) in 1991. He remains there today and therefore enjoys a perspective of the UK's bedrock, generating infrastructure that few, if any, others in his industry can match. We hope that OFGEM and DECC heed his wise advice.

We have his kind permission to publish the witty and enjoyable speech that he gave to the Institute of Diesel and Gas Turbine Engineers in April 2010.  

The points he makes remain as salient a year later as they were at the time. But the issues today are much more urgent because the Coalition still seems unaware of errors it should and could have learned from the previous thirteen years of groundless optimism, chatter and muddle.

In particular, David points out that

£200 billion (supposedly needed for the new infrastructure) is way beyond anything that those businesses have sitting in their bank accounts. This means that, for new investment to go ahead, companies have to persuade investors that the UK is a good place to put their cash. But, we are not the only ones looking for money. All this comes at a time when countless other countries around the world are looking for investment in energy infrastructure and also at a time when investors may well be more cautious with their money.


In other words, whatever the politicians are saying about the need for £200 billion of new investments, the money for the new "necessary" investments is simply not there.

It is, of course, "unthinkable" that the continuing dearth of timely new investment into non-gas-based power generation will lead to an absolute shortage of generating capacity in the event that gas price and supply shocks will cause our gas-based capacity to be inadequate to deliver supply, post 2015.

But the difficulty of suing for embarrassing derogations to keep our dirty, polluting and inefficient coal-fired power stations open post 2015 must not be under-estimated by the Coalition.

 

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