Campaign group WWF-UK has warned that Britain’s position as a leader in offshore wind energy is in danger of being undermined by an institutional bias towards oil and gas.
Highlighting an obscure legality in Crown Estate leases that continues to prioritise oil and gas exploration off the UK’s coast to the detriment of renewables, WWF urges the Government to stand by its commitment to a green economy and use the forthcoming Energy Bill to remove any barriers that could endanger future green jobs and climate targets.
WWF has uncovered a little known clause contained within Crown Estate leases which can terminate existing rights granted to offshore wind farm operators whenever the government declares a license for oil and gas exploration in the same area.
Not only can wind farm operators lose their lease, but they face premature decommissioning costs when their lease is revoked and are not entitled to any compensation to recover any expected financial returns.
WWF argues such uncertainty over the financial viability of these leases could potentially detract investors, with knock on effects for the renewables industry and the future growth of the green economy. This comes in a context that is already very favourable to the oil and gas industry.
Nick Molho, Head of Energy Policy at WWF-UK said: “For decades, the oil and gas industry has benefited from a very favourable environment with tax breaks, which are still being granted today, and more recently with an exemption from the licensing requirements of the Marine and Coastal Access Act 2009.
“The Government really needs to shift the focus of its energy policy away from oil and gas and instead unambiguously support the renewable energy industry, which is the industry of the future.”
Most worrying, is the impact this could have on the UK’s efforts to meet its renewable energy targets (by 2020 and beyond) and on the substantial number of green jobs that could be created in the UK by the offshore renewables industry.
WWF is calling for new legislation in the Energy Bill that will provide certainty for investors that renewable energy projects in the UK will at the very least be able to operate on a level playing field.
Where there is a conflict between offshore renewables and environmentally damaging oil and gas exploration, priority should clearly be given to renewable energy projects, in light of the UK’s climate change commitments and the sector’s potential to create a substantial number of new jobs in the UK.
Nick Molho added: “The new Government has a great opportunity to improve the investment climate for renewable energy in the forthcoming Energy Bill. The renewables industry clearly offers the greatest long term employment, environmental and energy security potential for the UK.”
Analysts suggest that in order to meet its EU target of producing 15% of its energy through renewables by 2020, the UK will need to generate 35% to 40% of its electricity from renewable energy, with offshore wind being a major contributor.
This share will need to increase if the UK power sector is to be near-decarbonised by 2030, as recommended by the Committee on Climate Change.
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