Keith Anderson, chief executive of Scottish Power, has questioned the recent trend of hoping to achieve subsidy free renewables, stating that for the foreseeable future energy infrastructure will have to be built with government support.
Anderson said: “I can’t understand why the renewables industry has become obsessed with talking about becoming ‘subsidy-free’. Right now, nothing in the UK energy industry is being built without some form of support, so why in god’s name is the renewables industry running around desperate to [be seen] as subsidy-free?”
“Everything has some form of support. If you think we are going build a £2.5bn offshore wind farm in UK at market risk, you’re bonkers.”
During a panel debate on ‘post-subsidy’ renewables at Aurora’s Spring Conference, Anderson said the UK market was not mature enough for power purchase agreements (PPAs), which large organisations use to mitigate risks.
He said: “If the only thing out there is a corporate PPA, the market will slow down dramatically, because frankly, that market doesn’t really exist in UK [at the scale required],” he added: “That might change in 5-10 years, but it doesn’t exist right now.”
Rising energy costs have come under fire from advocates for business groups and household consumers, with green subsidies cited as a major contributing factor to Britain having some of the highest energy bills in Europe.