This was loudly applauded – & not just by those who were there.
The march of renewables continues …. but it continues to be slow. If we are to slow, halt & reverse the effects of climate change we need to deliver more, sooner.
As someone involved in seeking funding for renewable projects & businesses with a background of delivering debt & equity into challenging sectors I have something of an overview of the challenges. There is no doubt that technology developers & project owners could do a better job of organising themselves & really understanding & narrating what they have that would attract investment. Nor is there any doubt that those with appetite to invest, including those driven to diversify from fossil fuel sectors, could stretch their risk appetite to encompass a wider spread of technologies & projects. Greenbackers Investment Capital & Deja Blue are both working hard with companies & investors to address these issues
BUT it is those with their hands on the policy levers that need to intervene to maintain & increase the momentum behind the sector.
Support in Europe is consistent & strong. The European Commission’s DG Clima are putting together an expert group with companies from each of the relevant sectors, to help design the future Innovation Fund. Ocean Energy is one such sector. The expert group will input into the design of the Innovation Fund & this is an important opportunity to influence a scheme that will be worth an estimated €3-4bn across many industrial sectors. Deja Blue is seeking to be part of that expert group.
The UK picture is sadly different. It is deeply concerning that a support mechanism – the Contract for Difference – that has so demonstrably delivered huge growth in offshore wind is effectively unavailable to the next generation of renewable technologies. The economic & social arguments on value for money for the consumer that are deployed to explain this don’t stand scrutiny when the headline commercial arrangements for the nuclear plant at Hinkley point are examined. EDF has negotiated a guaranteed fixed price – a “strike price”– for electricity from Hinkley Point C of £92.50/MWh (in 2012 prices), which will be adjusted (linked to inflation) during the construction period & over the subsequent 35 years tariff period. Decommissioning liabilities fall on the UK & the plant is being provided with a grid connection. This playing field is anything but level. The technology has NOT been built & operationally tested yet. This will NOT establish any new industry in the UK that could grow & export & help with post Brexit trade.
In the face of this lack of ongoing support the tidal sector has developed the Innovation PPA – offering tax breaks equivalent to the amount of support offered beyond commercially available pricing to companies signing up- as a possible mechanism that will offer support to that sector – let us hope it will gain traction.
In the meantime it is incumbent on us to start all the conversations that we have on these issue with reference to the fact that we depend on planet A & “There is no planet B”
……………thoughts from Deja Blue