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Energy CEO: Ministers must be clear on green subsidies

PUBLISHED: 06:30 11 October 2012

Environment  secretary Owen Paterson. Yui Mok/PA Wire

Environment secretary Owen Paterson. Yui Mok/PA Wire

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A key figure in the East of England’s energy industry hit out at ministers last night accusing them of giving conflicting messages about the financial support businesses would get from government.

Simon Gray, chief executive officer of the regional industry body the East of England Energy Group, fired the broadside after new environment secretary Owen Paterson suggested the subsidies system for wind farms was “Soviet” and should be scrapped.

Mr Paterson told an event at Tory conference in Birmingham: “There are significant impacts on the rural economy and the rural environment, all of which probably weren’t intended when these things were thought up. It is not very green to be blighting the economy in one area.”

It was reported yesterday that Mr Paterson was also planning to write to the Department of Energy setting out his view about ending green subsidies.

He went on: “If you start having subsidies you end up with a Soviet-style system, where politicians make decisions that might actually be better made by the market.”

Meanwhile Tory climate change minister Greg Barker also commented at the conference that the government would deal with what he called the “never-ending gravy train of green subsidies” in order to bring down energy bills.

Yet the two Tory ministers’ words appear to conflict with those of the Liberal Democrat energy secretary Ed Davey, who spoke in support of subsidies just two weeks ago at his party’s conference in Brighton.

After hearing their comments Mr Gray told the EDP: “The key issue here is that of clarity. The industry can respond to any changes in government strategy if it actually has a clear understanding of the policy and associated time frames.

“Ed Davey says that nothing has changed and that the drive to renewables continues unabated, however we have Owen Paterson and Greg Baker saying something quite different.

“The industry needs to know what subsidies and tariffs will apply before investors will consider business plans for the development of renewable energy sources.” Previously the New Anglia local enterprise partnership, a grouping of business and council leaders, has also raised concerns over of a lack of clarity on government subsidies.

Mr Gray continued: “One thing is clear, and that is we will need to get our electricity from somewhere and this is particularly true if industry emerges from recession and requires more energy to grow.

“We are fortunate in this region in that we have gas, offshore wind, nuclear and the potential for carbon capture and storage.”

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