The Cabinet Office published a remarkable report today on energy “Red Tape”. Why is it remarkable? Because reading it closely and between the lines, there couldn’t be a more damning indictment of this government’s handling of UK energy policy since 2010.
To be frank it is a complete mess. And all caused by the huge policy disruptions, contradictions and plain stupidity engendered by DECC and HM Treasury. Of course this “Red Tape” report and Cabinet Office can’t use such language. That would be too honest, and totally off the agenda as far as this government is concerned.
But just look at what is said in the report.
- “We have spoken to a wide range of businesses, from large and established energy companies to new starters and small and medium enterprises. We found the consultation process insightful and it was enlightening to hear views from such a variety of organisations”. Code that these businesses told government that it had made a complete shambles of energy
- “we have worked creatively to commit to an ambitious programme of reforms that will develop a longer-term narrative with a clear approach to policy, create a more joined up approach to regulation and will simplify processes and rules, adopting a more risk-based approach to compliance” Code for realising that Ministers have made up energy policy on the hoof
- “We were told that because energy projects take years, and sometimes decades, to complete longer term vision would help secure investment. Businesses told us that they need clear guidance which can be relied upon so they know they can proceed with projects with greater certainty and reduced risk” – Code that businesses told government that the interference of HM Treasury in energy policy had deprived UK of much investment in energy infrastructure
And what is the government doing about it? Well its all about DECC and Ofgem having a series of discussions, chats, consultations throughout 2016 – and probably well into 2017 – to try and right things.
But where is the HM Treasury in all this, because it is as clear as day, that whatever these two bodies come up with, they will be second-guessed yet again by HM Treasury.
So I wouldn’t hold out too much hope that we will have a stable UK energy market soon
But what is also very worrying about this “Red Tape” review is that there are two other major parties interested in the exploitation and delivery of energy. And yet their voices are totally absent from the review – namely the consumer and the environment.
So the review has not consulted with consumer bodies on the experience of consumers with energy providers. No doubt this is because there is a separate Competition and Markets Authority (CMA) enquiry underway. But in my view this is not good enough, especially as this review is taking 2 years and won’t report until June 2016 at the earliest!
And in connection with the environment, there are some worrying comments about energy companies objecting to the necessary evaluations of the impacts of their actions on nature, wildlife and communities. If the next steps by DECC, Ofgem are to remove so-called “Red Tape” to further relax these environmental assessments, then this is very bad news for UK nature and wildlife, especially with HM Treasury’s well known blind enthusiasm for gas fracking.