It’s been a busy couple of months for Greg Clark and Co. The Chancellor has delivered the Budget, while BEIS has (finally, many would say) published the Clean Growth Strategy (CGS), and then put out the much-anticipated White Paper for the Industrial Strategy.
Throughout these announcements and publications, ministers have repeatedly stated a commitment to clean growth. That, in and of itself, is no bad thing – and it’s certainly welcome that clean growth was featured as one of the four ‘Grand Challenges’ in the Industrial Strategy White Paper. But for the rhetoric and good intentions, the lingering question is how very laudable aspirations set out in the past couple of months will translate into tangible action.
An immediate criticism of the Government’s approach, following the publication of the CGS was that while it included a commitment of more than half a billion to fund Pot 2 of CfDs, the focus was very much on developing rather than established technologies. In other words, no further subsidies for onshore wind or solar. Some within the solar industry were frustrated (dare we say incandescent) that a proven technology was, once again, left out of the fold.
But was that really surprising? Ministers had never indicated they were going to row back on swingeing cuts to solar subsidies in 2015, which had certainly redefined the industry, but were now viewed as an unnecessary expense and a payment to companies already thriving. And when Claire Perry has since mentioned the UK’s first subsidy-free solar farm at the drop of a hat in the last month and a half, it’s not a shock ministers decided not to turn back the clock and return to the solar sector’s halcyon days.
Indeed, the past months could be seen as one for ‘the sound and the fury’ over renewables. Many were decidedly ticked off at the direction of public sector investment for renewables, albeit without any reason to expect a seismic change in policy. But comments about rhetoric could also apply to government. Clean growth has been championed at every turn. But are we actually going to see action to mirror the aspiration?
Renewable energy was a notable omission from the Chancellor’s Budget statement, and you needed to plough through the Budget document with a microscope to find reference to it. And, if you did, you’ll have found that ministers aren’t looking to make any further public investment in renewables (beyond the money allocated for CfDs) before 2025. And that’s before considering the Chancellor leaving the carbon floor price unchanged, and introducing tax changes that will aid North Sea oil and gas.
Add to that the CGS’s indication that ministers could use flexibilities to meet targets in the fourth and fifth carbon budgets, and suddenly the rhetoric of clean growth perhaps isn’t quite as promising as it appeared on first inspection.
When appearing in front of the BEIS Committee, Claire Perry insisted she had every confidence the Government would hit the Carbon Budget targets without the use of flexibilities. The Committee’s response was decidedly lukewarm to the suggestion.
The Government has made some very positive steps in the early part of the year – the Faraday Challenge amongst them. But we may need to see more tangible measurements of success come from the consultation on the CGS – and the ‘Prospering from the energy revolution’ programme that’s to follow the Industrial Strategy White Paper – for there to be a clear and tangible way forward.