The UK Express Is Heading For The Buffers
October 9, 2009 by Doug Kennedy
(Note: An item in the 6pm news today tells how the UK energy regulator is warning of energy shortages and huge price hikes in the coming years. This blog was written this morning BEFORE the announcement – nice timing!)
Renewable energy is very much in the public eye these days and the UK has an enormous looming energy problem owing to years of vacillation on policy, and complacency because the UK had it’s own oil and gas (now largely depleted). All the money from these resources has been spent and virtually none was invested in energy for the future. Now our nuclear power stations are mostly going out of commission and we didn’t develop the nuclear technology that we invented to create an exportable UK-based nuclear industry. In the meantime, the take-up of renewable energy has been pathetic owing to lack of investment and direction at government level, and a very damaging application of the planning laws that has prevented many wind farm and solar developments from being started. The government is talking about turning this situation around in the Energy Transition white paper, but nothing in that is even close to implementation and there is no sense of urgency, although that situation might change after the Copenhagen summit.
In the news today we are told that the UK needs to invest billions of pounds in developing energy infrastructure or we will be almost entirely dependent upon imported gas, which puts us in a terribly weak position and vulnerable to the vagaries of other countries, such as Russia. We have seen this coming for many years but we now have a huge national debt and it is difficult enough to work out how to repay the debt we have, let alone investing further billions in new projects.
I have an investment interest in a UK company called PV Crystalox Solar. This is the largest UK business working in renewable energy producing photo-electric cells which are widely exported. The shares have suffered this year as the market for their product has greatly reduced at a time when the World drastically needs these technologies to be used. Interestingly, one problem for PVhas been that the Spanish government were providing grants for people to erect solar panels and sell electricity back to the national grid, but the take-up was so huge that they have put a cap on it, stopping further applications for the moment.
The UK government is still talking about doing the same thing but haven’t yet, probably because they are afraid that they’ll loose tax revenue (in VAT and company tax from energy companies) if they do. Some investment in the electricity market and grid is also required, but there are huge benefits for people in installing solar and other power generation in their homes and for the country in setting up wide-spread micro-generation, especially for energy security and cost in the coming years. There are also, obviously, substantial environmental benefits.
So we seem to have a situation where people are interested in taking up renewable energy technologies, the UK government desparately needs to solve the energy problem and The Earth systems that support us need us to stop pumping CO2 into the atmosphere. However, nothing substantial is happening in the UK and renewable energy companies are having a tough time keeping their businesses going when they should be thriving.
It feels like being a passenger in a train in which the driver is having an argument with the guard and is not at the controls as the train progresses inexorably towards the buffers.