Friday 17 March 2000

Energy Sector Calls for Review of Stricter Consents Policy

A cross industry forum has been set up to review the impact of the Governments policy on stricter consents for gas-fired power generation amid growing concern about the continuing damage it is causing to jobs and investment.

The Pan Industry Group Against Stricter Consents, whose members range from gas producers and independent power generators to organisations and companies representing manufacturers, contractors and energy end users, met yesterday (16 March 2000). The meeting was hosted by the UK Offshore Operators Association (UKOOA), the representative organisation for the offshore oil and gas industry.

The reforms agreed by the Government and Ofgem over the last two years have largely resolved the issues that first triggered the introduction of a stricter consents policy on gas-fired power stations.

Market distortions will be eliminated by the new electricity trading arrangements (NETA) introduced by the Utilities Bill this autumn. Competition has increased as new power generation companies have entered the marketplace.

But the success of the electricity market reforms, highlighted by Ofgem in its recent report, has not been achieved without cost to industry. Investment and jobs in the gas supply and power generation construction industries have been lost as a direct result of the restrictions on new gas fired power generation. If this policy is not reversed further investment, export opportunities, skills and jobs in these industries will be at risk. Now is the time for the Government to review its position and lift its restrictions on new gas fired power stations.

The new group is now working on an initial study of industry data and intelligence to determine the effect of the policy, both directly and indirectly, and the opportunities for future investment and employment that will continue to be lost should the policy remain in place.

For more information, please call 020 7802 2400.