By Marcus Leach
Businesses are concerned that current UK energy regulations will not raise the investment needed to ensure the country’s low carbon future, and are calling on the government to either simplify or scrap some existing legislation to ensure targets can be met.
These are the findings of a consultation by npower among business energy users, which found that one in three (32%) do not believe that legislation such as the Carbon Reduction Commitment Energy Efficiency Scheme (CRC), Climate Change Levy (CCL) and Climate Change Agreements (CCAs), the Renewables Obligation and Feed In Tariffs will help ensure the £200bn investment needed for the UK’s energy infrastructure is achieved.
The results of npower’s consultation, which is still ongoing, will be fed back to government as part of its Red Tape Challenge initiative. The government consultation on the energy sector formally opens on 25 November.
Against a backdrop of political debate on how to best regulate the energy industry, npower asked businesses which energy legislation they would keep, which they would like to see simplified and those they would like to see scrapped completely.
Perhaps unsurprisingly, the CRC received most attention, with over two thirds of businesses (69%) wanting to see the scheme simplified and more than half of business (57%) believing it should be scrapped. Over a third (38%) would like to see it merged with existing regulation.
There was also a call to scrap the Renewables Obligation among some businesses (41%), with nearly half (47%) calling for it to be simplified. Opinion was split on CCL and CCAs, with 29% wanting to see them scrapped, and 32% believing they should stay.
“Energy policy ultimately drives British business. But, as the Government recognises through its Red Tape Challenge initiative, there is a mammoth amount of legislative cost burden on British businesses," Wayne Mitchell, interim industrial and commercial markets director at npower, commented.
"Groups such as the CBI have been very vocal about how this legislation is not only stifling domestic growth, but also making the UK less competitive on an international scale.
“At the moment the energy market is neither fully regulated, nor fully liberalised and that this ‘in-between’ situation is leaving businesses and investors in limbo unable to make an informed decision. That is why we again urge the business community to make sure their voices are heard. This is a unique opportunity on an unprecedented scale to have a say on energy legislation — and our own consultation reveals a mixed bag of views so far.
“However, one thing is clear — businesses want simplification not only to help them manage their own obligations, but to also help the UK meet its carbon reduction targets and help raise the investment needed for low carbon generation."
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