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UK energy policy is right on coal but more clarity rapidly needed on renewables and energy efficiency

18th November 2015

Reacting to today’s speech by the Secretary of State for Climate and Energy the Rt Hon Amber Rudd MP, the Aldersgate Group welcomed the government’s commitment to phase out the UK’s old coal-fired power stations but stressed that more clarity was rapidly needed on the government’s plan to support future investment in renewables and energy efficiency if the UK was to meet its objectives on carbon emissions, affordability and security of supply.

The Aldersgate Group welcomed the government’s decision to set a clear date for the closure of the UK’s old coal-fired power stations, as this will help modernise the UK’s energy infrastructure and reduce carbon emissions.

Nick Molho, Executive Director of the Aldersgate Group said: “The closure of the UK’s old coal power stations is a pre-requisite to modernising the UK’s energy system. It will help reduce carbon emissions and make clear that modern gas-fired power stations, not coal, are the best complement to increasing amounts of low carbon generation.”

The announcement that three CfD auction rounds for offshore wind will take place during this Parliament was also a positive step forward. However, the Group stressed that more clarity on the funding available to support these auctions and policies to facilitate investment in other forms of low carbon generation such as mature renewable energy technologies was rapidly needed. This was essential to support continued investment in these technologies and secure further cost reductions for consumers and supply chain benefits for the UK economy.

Nick Molho added: “Having provided over 25% of the UK’s electricity in the second quarter of 2015 and demonstrated significant cost reductions in recent years, renewables have an important and growing role to play as part of a secure, low carbon and affordable energy system but the current lack of specific policy has been undermining further investment. Building on today’s positive announcement on offshore wind, the government must rapidly set out its proposals in more detail as to how it will support continued investment and cost reductions in the renewables sector.”

The Aldersgate Group called on the government to clarify as soon as possible the funds that would be available for investment in low carbon power stations under the levy control framework and under what mechanism investors could still develop mature and cost competitive renewable energy technologies such as onshore wind and solar projects.

The Aldersgate Group also highlighted that clarity was needed as to how the government would support investment in a range of other infrastructure areas that were key to meeting the UK’s carbon targets on time and on budget. This included in particular future policies to guide investments in energy efficiency, carbon capture and storage, low carbon heat and low emission vehicles.

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