The region’s biggest business membership organisation has written to Chancellor of the Exchequer George Osborne to highlight the damaging effect that Government indecision has upon energy investment and growth in the North East.
The North East Chamber of Commerce (NECC) claims repeated reviews of policy are delaying investment which could be worth 40,000 jobs to the region within 20 years.
The letter follows the conclusion of a protracted Government review into subsidies for UK renewables projects in which Renewable Obligation Certificates (ROCs) were reduced by 10%.
NECC Policy Adviser , Mark Stephenson , said:
“This decision took too long to make. The delay and the general indecision on energy policy is strangling a key sector of the North East economy.
“While NECC welcomes the settlement of the ROC review, it has only temporarily halted uncertainty about UK Government funding for renewables projects.
“The banding levels will be reviewed again during 2014 and this has immediately caused investors to question how this will impact upon their investment plans looking forward.
“The North East stands to gain hugely from growth within the energy sector. It is estimated that by 2030 the North East will see the creation of an extra 40,000 jobs in the sector owing to opportunities in areas such as onshore and offshore wind, energy from waste, chemical re-processing, electric vehicle and battery production, mineral extraction and carbon capture and storage.
“At present a woeful cocktail of indecision, procrastination, and misunderstanding about what investors need is hampering the creation of much needed jobs and wealth for UK Plc, and at a time of huge economic uncertainty.
“Unfortunately, investors here and elsewhere are quickly losing faith in the ability of the UK Government to make effective decisions which are based on the long term needs of businesses rather than short term political calculations.”
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Offshore WIND staff, August 2, 2012; Image: HM Treasury