The UK needs to find an extra 20 GW of power generation capacity in less than 10 years – and “existing players don’t have the capacity to invest at that kind of scale”.
That was the message from UK Energy Secretary Ed Davey today as he issued a rallying call to bring investors into Britain’s power market.
Speaking at an energy business summit in London, Davey said that by 2020 the UK needed to attract £110bn of investment in electricity generation.
He said the UK was “talking about building as much as 18 GW of offshore wind by 2020 and 16 GW of new nuclear power by 2025”, but the financial backing for these projects was insufficient at the moment.
“We need new players, including institutional investors, who have the muscle to make big investments in technologies with high capital costs,” he said.
“That means doing everything we can to take the risk out of investing in the UK’s energy markets. From a government perspective, that means making sure we keep political risk to a minimum.”
And he vowed to set a clear policy direction to reassure investors and entrepreneurs alike that the UK will “remain a great place to do low-carbon business”.
He said the only way to unlock the investment that was needed was to ensure that the UK’s energy policies “are predictable and based on the evidence”.