Low Carbon Energy Generation Offered
By Anne Lewis-Schneider
Government set to offer investors a new draft.
A draft was published on the 7th of August detailing a new offer from the UK government to investors in the generation of low carbon energy forms. Government has decided itís time to reform the electricity market and it will do this through the new Energy Bill. The aim of this draft is multi-fold, firstly to keep power on, secondly to reduce costs of energy to the consumers, and thirdly to provide a reduction in the levels of carbon emissions caused by power generation.
The UK desperately needs to upgrade its energy infrastructure and a new support structure is about to be introduced, primarily to raise the amount of £110 billion from the private sector in the form of investments by 2020. Contracts for Difference in the long term alongside a Capacity Market will help to bring this about.
Business and Energy Minister Michael Falon has commented that the British Energy sector is unmatched by any other in Britain in terms of investment opportunity and the extreme size of the infrastructure challenges faced. Mr. Falon continued that the publication of the terms in detail will bring more certainty to the energy market and the investment community. He said that the new support structure would make it possible to deliver and produce more cost effective low carbon fuel generation of approximately £5 billion up to 2030 in the long term, thus placing the UK a step ahead in what has become the global race to develop and produce new clean technologies and would bring about the generation of 250,000 jobs throughout the energy sector.
It is hoped that industry will be able to supply some feedback on the new draft contract terms in the near future, and government has assured that the final terms of this draft will be expected by as soon as December this year. Along with the draft contract, is the manner in which contracts will be allocated in the future. When compared to the old system of Renewables Obligation, this new draft support mechanism is set to deliver what is needed most at the present time, and that is a source of more cost effective low carbon emission fuels, energy and generation of power with a lower impact as far as global warming and dangerous climate changing emissions is concerned.
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