Industry gives energy review a muted welcome

The Government’s Energy Review has been given a lukewarm reception by industry. The Review, which was announced on 11 July by trade and industry secretary Alistair Darling endorses the building of a new generation of nuclear power plants, as well as placing greater emphasis on the need for energy efficiency and the need for renewables to provide a bigger proportion of the overall energy supply.

However, many in the industry believe it doesn’t go far enough. David Strong, managing director of BRE Environment says the review provides no specific details regarding new incentives. He said: “Significantly, the Review does not restate a key conclusion from the 2003 Energy White Paper that ‘the cheapest, cleanest and safest way of addressing our energy policy objectives is to use less energy.’”

The National Energy Foundation also gave the announcement a muted welcome. It was encouraged by support for some sustainable energy systems, but warned there was a real danger that these could be swamped by the focus on large-scale supply issues, including nuclear. “The government has missed a chance to provide a level playing field for energy generation in the UK at local and community level,” said Tim Lunel, chief executive of the National Energy Foundation.

The Government has missed a chance to provide a level playing field for UK energy generation at local and community level

Tim Lunel, NEF

The Renewable Energy Association (REA) welcomed the endorsement of the renewable electricity target to 20% by 2020 and an increase in the biofuels target to 10% but called for the government to back up the initiative with effective policy measures. “The Energy Review supports what we and many others have been consistently saying – that renewables, energy efficiency and decentralised systems are the strongest prospects for secure and sustainable energy supplies,” said Philip Wolfe, chief executive of the REA.

Measures put forward in the Energy Review include:

• Developing a new Planning Policy Statement (PPS) on climate change. The Government plans to consult on this later in 2006, and introduce it in 2007. The new PPS will also encourage the use of more sustainable energy sources, including microgeneration, and combined heat and power.
• Consideration of amendment to the Energy Efficiency Commitment (EEC: the programme whereby domestic energy suppliers help improve the efficiency of dwellings) to include all forms of microgeneration. The Government will therefore be consulting this summer on whether to extend the range of measures allowed under the third phase of the EEC.
• The Government will undertake a wide-ranging review of the long-term potential and challenges of distributed generation, including combined heat and power, as an alternative or large-scale supplement to centralised generation. It will be taken forward as part of a Foresight Project looking at sustainable energy management in the built environment, by the Office of Science and Innovation.
• The Government and Ofgem will lead a comprehensive review of the incentives and barriers that impact on distributed electricity generation including CHP. This review will be prepared in the first half of 2007.