Will alternative energy investment help to power construction in 2014?

The economic benefits of investing in nuclear power are clear. In July 2013, the Department of Energy & Climate Change (DECC) announced financial incentives for communities in England hosting nuclear power plants, wind farms or shale gas development. Under the scheme, local governments would receive a 50% share of business taxes from a new plant for the first ten years of operation, and then £1,000 per megawatt of installed capacity annually for a further 30 years.

In monetary terms, for Hinkley Point C, this could amount to £128 million over a nominal 40-year plant lifespan for Sedgemoor District Council.

However, the project has courted controversy from the outset. Jim Ratcliffe, the owner of global chemicals company Ineos, told the BBC in December 2013 that power from the proposed Hinkley Point C nuclear generating station will be too expensive for UK manufacturers. The government has guaranteed a price of £92.50 per megawatt hour for Hinkley, but Mr Ratcliffe claimed Ineos recently agreed a deal for nuclear power in France at just 45 euros (£37.94) per megawatt hour.

The government carried out a public opinion survey showing the UK remained positive regarding nuclear power, despite an upsurge of bad press following the Fukushima disaster in 2011. YouGov also found that 63% of Britons supported the use of nuclear power, with only 22% opposing building new plants on brownfield sites. It is unclear where the people taking place in the survey were based, but of the 1,734 people polled, it showed 40% of them think the UK Government should use more nuclear power than it does at present - an increase of 5% on the year before.

Alongside nuclear power, wind energy will continue to push forward during 2014. Glenigan is currently tracking billions of pounds worth of proposals for wind farms, on-and off-shore, that would ultimately have capacity to generate alternative energy for thousands of homes.

The number of planned new on-shore wind farms has doubled since 2011 and record numbers of have been approved for construction this year as power companies cash in on the DECC’s alternative energy subsidies.

Off-shore wind farms are also getting bigger, with a clutch of multi-million and billion pound proposals along the south and west coast of the UK. The east coast is fast becoming another playground for developers, as the Crown Estate lease parcels of the ocean for developments.

Final public information days are set to be held from 21 to 24 January for one such wind farm development at Navitus Bay, just west of the Isle of Wight (Glenigan Project ID: 10027617). If approved, the park will comprise between 150 and 240 turbines, depending on the energy generation needed and the type of turbines used.

While these new developments keep emerging, is the UK leading the way at meeting its green energy targets? How do we compare with Europe and the rest of world?

After previously generating 75% of its power from coal, China has this year embarked on the greatest push for renewable energy the world has ever seen. The country plans to double its number of wind turbines in the next six years, the BBC reported last week, employing its own work forces for putting together the turbines and situate them on sites.

From a current installed capacity of 75 gigawatts (GW), the aim is to achieve a staggering 200GW by 2020. By contrast, the European Union countries together have just over 90GW of installed wind capacity.

The EU must decide, sooner rather than later, on an energy and climate policy framework for 2030. This will continue to encourage investment in the industry to help it deliver on its targets. The plan is for the EU to meet its greenhouse gas reduction commitment of 80-95% by 2050. With continued investment, our energy sources will become more climate efficient and, hopefully, effective.

For further information about alternative energy within the construction industry, contact Caroline Lockyer, utilities sector expert at Glenigan, on 01202 786723.

Do you think mega projects such as Hinkley Point herald a new era of public support for the alternative energy sector or do you think it will continue to divide opinion? Get involved with the debate on Glenigan’s social media channels via the icons at the top of the screen.

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