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RWE exec warns of lower UK investment without long term energy policy guarantees
- 11 years ago (2013-02-13)
- Junior Isles
German energy giant RWE is warning UK officials that it will significantly scale back its investment in the UK unless it gets guarantees over energy policy.
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RWE, owner of npower, invested 60 per cent of its European investment budget into UK energy infrastructure over the past three years; more than £3bn in total and more than any other energy company.
“I doubt that we will be investing the kind of money we have been investing unless there are propositions which attract not only us but also enable other capital lenders to come into the market place”, Paul Massara, npower chief executive and RWE’s UK representative, has said.
A large proportion of RWE’s UK investment has been in the two efficient gas-fired power stations at Pembroke and Staythorpe. Massara says these “…aren’t running a lot of the time…” though because margins were lower than had been expected. He stated it was improbable that RWE would invest in more gas plant soon.
Meanwhile, the company will continue to invest in renewables including wind projects already underway and the likely conversion of its Tilbury power station from coal to biomass, Massara said.
Around £110bn of power investment is needed to secure UK supply over the next decade. Mr Massara claims this investment must not just come from energy utilities and also requires incentivising pension funds to invest. “If you want to get those guys involved you have to provide long-term certainty and clarity of purpose and that’s what’s so desperately needed.”
UK officials are currently examining an Energy Bill, intended to help encourage investment.
“The Energy Bill is getting us there but there is a huge amount of detail that is still missing, that we need to absolutely understand in order to make those investment decisions,” Mr Massara said.