The UK government’s Electricity Market Reform will lead to a “train wreck” in the country’s power sector, according to six of the country’s leading renewable energy firms.

The companies say the EMR is “unworkable” and claim that instead of stimulating investment as intended, it will deter financial backing for low carbon technologies.

Ed Davey

The EMR is the cornerstone of the coalition government’s plans to boost growth in low carbon energy and involves setting a carbon price floor and replacing existing subsidies with long term contracts.

But the six companies – SSE, Ecotricity, Fred.Olsen Renewables, RES, Natural Power and Good Energy – say the reforms are “extremely complicated, introducing new risks and uncertainty, as well as diverging from other well understood European support mechanisms”.

In a letter to UK Energy Secretary Ed Davey, they welcome the need to move to a secure and decarbonised electricity system”, but state that the contracts for difference that will replace existing subsidies are flawed and as such, will deter investment in renewable generation and “threaten the build up of supply chains and jobs in the UK”.

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