CBI leads major businesses in call on government to embrace renewables transition

The Confederation of British Industry has led calls from some of the UK’s largest businesses for the government to embrace the transition to renewable power, rather than stymie it.

An open letter, published today, has urged the government to build on the climate agreement reached at COP21 and produce a clear, long-term framework that will trigger the required investment into the UK’s energy infrastructure.

Led by CBI director-general Carolyn Fairbairn and signed by prominent CEOs and chairmen such as Aviva’s Sir Adrian Montague, Tata Steel’s Karl Koehler, Lloyds Banking Group’s Tim Hinton and Carillion’s Richard Howson, the letter states that the country’s transition to low-carbon power is being led by businesses.

“Businesses… have increased the UK’s use of renewable energy for our electricity supply from 11% to 25% in just three years. Companies are also investing to improve their energy efficiency, and to help consumers manage their electricity costs and reduce overall energy demand – installing smart meters in millions of homes across the UK.

“Getting the investment we need to address this requires clear leadership and stable policy from government. We need more of this in 2016. To unlock investment, we need a clear long-term framework – so companies can plan for construction projects that will last into the next decade,” the letter reads.

It also pushes the need to embrace storage technologies and those that enable peak-time demand management “to ensure the shift to more intermittent renewable energy doesn’t affect security of supply for homes and businesses”.

“Finally, we also need an overhaul of complex regulations holding back investment in energy efficiency – so that the best intentions to support firms to reduce their energy use and carbon impact are not lost in bureaucratic ‘green tape’,” the letter concludes.

The CBI’s letter will only serve to heap additional pressure on the Department of Energy and Climate Change to come forward with a more coherent and complete energy strategy. The Institution of Mechanical Engineers has this morning attacked the government for creating a looming energy crisis, warning that the UK could face an energy shortfall of 55% by 2025 if the government pressed ahead with its current strategy.

The letter comes a number of months after former CBI director-general John Cridland attacked the government’s stance on renewable energy before he stood down in November last year, claiming that it had cost British businesses hundreds of billions of pounds in lost export opportunities.

Speaking at an event last September, Cridland warned that the UK’s leadership on climate policy was “hard won, but easily lost” and said that the government was at risk of “sending a worrying signal to businesses” by rolling back renewables support frameworks.

But both energy secretary Amber Rudd and prime minister David Cameron have dismissed criticism for the raft of green cuts enacted as part of a wider energy policy reset. Earlier this month Cameron labelled the claims “total and utter nonsense” when quizzed by the Liaison Committee.