The UK Government must extend the compensation package to some energy intensive industries that weren’t initially covered.
Jeremy Nicholson, Director of the Energy Intensive Users Group told ELN there are concerns about the “mounting costs of the renewable programme and to a lesser extent our decarbonisation goals generally”.
However they have been offset by the compensation package but added: “There are some unsolved puzzles that weren’t dealt with completely by the previous government and that includes extending the compensation package to some energy intensive industries that weren’t initially covered. In other words, finishing the job off and I think if the government can do that it will be welcomed by industrial users.”
In 2013, the government launched a package worth £113 million for steelmakers and ceramics companies for the extra power costs caused by the impact of European carbon pricing schemes.
Mr Nicholson said the EU Emissions Trading Scheme must be reformed as one of the bigger issues that needs to be tidied up is “what’s going to happen to our unilateral carbon price floor”.
However he said “there aren’t particularly great expectations but equally no particular fears” following the Conservative election win as it means continuity and stability for the sector.
He added the Contracts for Difference scheme and having more competition between low carbon technologies “is definitely the way to go”.
Mr Johnson said: “In fairness, the Liberal Democrats when were in Coalition supported that too because it’s competition that’s going to keep the cost down and make it affordable for consumers. If it’s not affordable for consumers, it’s not going to be sustainable and the energy industry won’t be able to make the billions of pounds worth of investment in confidence.”