British ministers ditch meeting with clean energy bosses amid renewable investment fears – POLITICO

LONDON — The British government has pulled out of a meeting with green energy bosses amid widespread concern that its flagship scheme for investing in renewable energy will fall well short of expectations.

Energy bosses had expected to meet Treasury minister Gareth Davies this Thursday, the same day the government is tipped to announce the latest allocation of long-term funding contracts for clean energy firms in areas like offshore wind and solar power.

But business leaders were told late last week that the meeting had been postponed, according to an energy industry figure.

The Treasury gave no specific reason for the change of plans. An official from the department said ministerial diaries are “always subject to change.”

But the industry figure, granted anonymity to discuss interactions with government, said the decision not to meet on the day of the announcement was “not great optics for government.” They added: “We’re expecting the results [of the funding round] to be pretty terrible.”

Investment gloom

The move comes amid mounting concern that Rishi Sunak’s government — which has in recent months pushed ahead with granting new oil and gas drilling licenses and warned that the push to cut carbon emissions must not hit voters in the pocket — is giving mixed messages on the switch to clean energy.

The Department for Energy Security and Net Zero is expected to announce the results of the government’s fifth Contracts for Difference (CfD) allocation round on Thursday morning.

The CfD scheme is a key pillar of government’s plan for clean electricity by 2035 and for net zero carbon emissions by 2050. It has run since 2015 and, as of this year, will be subject to annual auctions.

Energy companies were invited to bid for a share of £227 million of government support for renewable projects, based on a price for energy that the government guarantees.

But renewable energy bosses said that the maximum price that the government was willing to guarantee had been set too low, at a time when soaring inflation has hugely increased supply chain costs for offshore wind companies in particular, prompting fears that many may have chosen not to bid this time around.

The so-called “administrative strike price” in the contracts was too low to be viable for most offshore wind projects, said Nathan Bennett, head of public affairs at the RenewableUK trade association.

“It will be a huge knock to investor confidence on Thursday if the auction turns out to be as deeply unsuccessful as everyone thinks it is going to be,” he added.

While there is gloom surrounding offshore wind investment — a sector relied on to deliver the biggest chunk of the U.K.’s future clean energy needs — industry figures are more hopeful that solar and tidal projects have been able to bid successfully.