Here\’s the real problem with all this low carbon energy malarkey:
And even once you take all of these changes into account, they still might not be enough to make the energy industry invest. As one executive observes: \”Can we trust the Government to keep its word on the pricing regime once the full impact on household bills strikes home? Somehow I doubt it.\” George Osborne\’s smash-and-grab raid on North Sea oil in the last Budget gives every reason to suppose that good intentions will eventually take second place to political expediency. The big companies won\’t invest if they suspect, even remotely, that it\’s on the basis of empty promises.
Whatever the system that\’s set up, carbon price floor, feed in tariffs, carbon trading, carbon tax, ROCs, taxes, subsidies, absolutely whatever, they all depend upon the government keeping its word. For decades.
And we think the chances of that are what?
Feed in tariffs have lasted 14 months before their first radical change. The North Sea tax regime has been tweaked (umm, radically changed) by both Grodon Brown and G. Osborne in the last decade alone.
Politics, facing as it does yearly council elections, 4 or 5 yearly national elections, 5 yearly Euro elections, all on different cycles, isn\’t really known for having firm, settled, non changeable, policies for a couple of decades.
Yet whatever the policies are they need to be believably committed to for at least those couple of decades.
I wouldn\’t hold out much hope here.