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Confederation of British Industry calls for government to reduce investment risk in UK’s low carbon infrastructure
A Report published by the Confederation of British Industry calls for government action on reducing investment risk and greater policy certainty.
26 April 2011
A report published by the Confederation of British Industry (CBI), has found that the UK is failing to attract the investment needed to build low carbon infrastructure. The publication titled ‘Risky business: Investing in the UK’s low carbon infrastructure', reports that “business leaders are not convinced that the UK can attract low-carbon investment at the scale and pace required”. Whilst the report finds that there is “sufficient private capital available”, the competition to secure that investment is tough and global; the UK is one of many countries pursuing expansion in low carbon markets and private companies will locate to areas with the most attractive risk/return profile. The CBI report that whilst those interviewed identified a range of investment risks associated with low carbon investment, many of which are universal i.e. technology risk, there were a number of risks identified as UK specific, including policy and regulatory risk. The report recommends that the government take action to stimulate the right investment conditions, specifically through reduction of investment risk, as the alternative of increasing investor returns could prove too costly. The report recommends that the government “should look first to reduce risk already under its control-market and policy risk”. The report also makes key recommendations for using the upcoming White Paper on electricity market reform as a key signal to the energy industry, developing a finical plan for the Green Deal with private investors and allowing the Green Investment Bank to issue government guaranteed bonds as soon as possible.
Find out more
A report published by the Confederation of British Industry (CBI), has found that the UK is failing to attract the investment needed to build low carbon infrastructure. The publication titled ‘Risky business: Investing in the UK’s low carbon infrastructure', reports that “business leaders are not convinced that the UK can attract low-carbon investment at the scale and pace required”. Whilst the report finds that there is “sufficient private capital available”, the competition to secure that investment is tough and global; the UK is one of many countries pursuing expansion in low carbon markets and private companies will locate to areas with the most attractive risk/return profile. The CBI report that whilst those interviewed identified a range of investment risks associated with low carbon investment, many of which are universal i.e. technology risk, there were a number of risks identified as UK specific, including policy and regulatory risk. The report recommends that the government take action to stimulate the right investment conditions, specifically through reduction of investment risk, as the alternative of increasing investor returns could prove too costly. The report recommends that the government “should look first to reduce risk already under its control-market and policy risk”. The report also makes key recommendations for using the upcoming White Paper on electricity market reform as a key signal to the energy industry, developing a finical plan for the Green Deal with private investors and allowing the Green Investment Bank to issue government guaranteed bonds as soon as possible.
Find out more
