UK clean tech confidence fading fast
Ernst & Young survey finds growing business frustration at repeated green policy changes
The UK clean tech sector faces a crisis of confidence, following a series of policy changes that have left industry figures pessimistic the emerging industry can deliver the promised boost to jobs and economic growth.
The coalition pledged to put low-carbon growth at the heart of its commitment to becoming the ‘greenest government ever’, but in response to a survey of 600 executives conducted by Ernst & Young, just 14 per cent expressed confidence that the clean tech sector would actually deliver significant economic growth and green jobs over the coming years.
Six months ago, this figure was as high as 65 per cent, but the last three quarters have seen repeated drops in confidence level.
Suprise cuts to feed-in tariff levels for large solar projects, rows between government departments over carbon targets and green policies, and a “lack of clarity” over flagship policies such as the Green Deal and electricity market reform were widely blamed for eroding optimism, Ernst & Young said.
Only 39 per cent of respondents thought investment in clean tech would increase this year against 2010 levels, compared with 61 per cent last November, providing further evidence that the UK’s drop from third-highest global clean tech investor to 13th in a recent report by the Pew Charitable Trusts could continue.
In addition, just over a third of respondents felt optimistic over the country’s prospects in the global market, down from 65 per cent in November, with 41 per cent saying they are actively pessimistic about the UK’s position.
“Compared with the level of ambition, clarity of policy direction and scale of investment being delivered by a number of other countries, the UK is in danger of being left behind,” said Steve Lang, Ernst & Young’s UK clean tech leader. “With decisive action, and more radical policies and mechanisms to attract investment, we can recover our position, but time is running out.”
Lang advocated stimulating the market with a combination of financial incentives and efforts to educate people as to the importance of the clean tech sector in the country’s economic recovery.
The recent announcement of lofty emissions targets in the fourth carbon budget and the establishment of the Green Investment Bank (GIB) are positive steps towards regaining confidence in the battered sector, Lang said.
“As long as uncertainty prevails, investors will find other regions more attractive investment destinations,” Lang said. “We hope the ambitious new carbon-reduction targets and GIB are the first in a raft of measures the government will implement to get the UK on track to realise the growth opportunity.”
A spokesman for the Department of Energy and Climate Change (DECC) insisted that its policies “will make the UK the destination of choice for global low carbon investment.”
“The UK is already an attractive place to invest and the prospects for massive growth in this sector are strong,” he said. “We are already leading the world in offshore wind, with more installed capacity than any other country, further construction under way, and big name turbine manufacturers considering locating here.”
The UK clean tech sector faces a crisis of confidence, following a series of policy changes that have left industry figures pessimistic the emerging industry can deliver the promised boost to jobs and economic growth.
The coalition pledged to put low-carbon growth at the heart of its commitment to becoming the ‘greenest government ever’, but in response to a survey of 600 executives conducted by Ernst & Young, just 14 per cent expressed confidence that the clean tech sector would actually deliver significant economic growth and green jobs over the coming years.
Six months ago, this figure was as high as 65 per cent, but the last three quarters have seen repeated drops in confidence level.
Suprise cuts to feed-in tariff levels for large solar projects, rows between government departments over carbon targets and green policies, and a “lack of clarity” over flagship policies such as the Green Deal and electricity market reform were widely blamed for eroding optimism, Ernst & Young said.
Only 39 per cent of respondents thought investment in clean tech would increase this year against 2010 levels, compared with 61 per cent last November, providing further evidence that the UK’s drop from third-highest global clean tech investor to 13th in a recent report by the Pew Charitable Trusts could continue.
In addition, just over a third of respondents felt optimistic over the country’s prospects in the global market, down from 65 per cent in November, with 41 per cent saying they are actively pessimistic about the UK’s position.
“Compared with the level of ambition, clarity of policy direction and scale of investment being delivered by a number of other countries, the UK is in danger of being left behind,” said Steve Lang, Ernst & Young’s UK clean tech leader. “With decisive action, and more radical policies and mechanisms to attract investment, we can recover our position, but time is running out.”
Lang advocated stimulating the market with a combination of financial incentives and efforts to educate people as to the importance of the clean tech sector in the country’s economic recovery.
The recent announcement of lofty emissions targets in the fourth carbon budget and the establishment of the Green Investment Bank (GIB) are positive steps towards regaining confidence in the battered sector, Lang said.
“As long as uncertainty prevails, investors will find other regions more attractive investment destinations,” Lang said. “We hope the ambitious new carbon-reduction targets and GIB are the first in a raft of measures the government will implement to get the UK on track to realise the growth opportunity.”
A spokesman for the Department of Energy and Climate Change (DECC) insisted that its policies “will make the UK the destination of choice for global low carbon investment.”
“The UK is already an attractive place to invest and the prospects for massive growth in this sector are strong,” he said. “We are already leading the world in offshore wind, with more installed capacity than any other country, further construction under way, and big name turbine manufacturers considering locating here.”
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