Friday 22 March 2013

We want a single backer for low carbon energy, Government told

The Government needs to work out who’s going to financially back its new scheme to pay for low carbon energy - and sooner rather than later, the head of an energy trade body said this week.

Angela Knight, chief executive of trade body Energy UK derided official dithering over who will be the “counterparty” to the Contracts for Difference or CfD, which is important for both new nuclear power projects and renewables.

Speaking at the Nuclear New Build conference in London, she said there was no point in the Government trying to “hedge its bets” by suggesting more than one body can be responsible for collecting the cash for the scheme.

Mrs Knight said: “Multiple counterparties are complex – we need a single one. Investors need reliability that the counterparty can collect payments... An ‘enforceable debt’ is the legal phrase but that phrase is not yet in the bill.”

The former head of banking body the British Bankers’ Association couldn’t resist a financial analogy, stating we shouldn’t have the counterparty accounted for as if it’s a “derivative”, adding: “Never  underestimate the possibility of accounting to really foul up”.