The chorus from business is now deafening: "give us certainty on energy policy and low carbon investment"

Businesses need to know what will happen in the future, writes RenewablesUK's Maf Smith. A government in turmoil can't provide that.

Government traditionally likes to avoid picking winners. Individual businesses are rightly in competition with each other. This creative tension is what drives our economic success. Such disagreements are why government traditionally goes to great lengths to avoid second guessing the market. 

However, there are some areas of the economy, like our energy infrastructure, where government has to stay at the table. Today, most politicians will agree that there are market failures in our energy system, and government needs to play a role to solve our so called “energy trilemma”: making sure that the lights stay on, ensuring we have secure sources of energy available, while also cutting greenhouse gas emissions. 

But even though government accepts it has a role, it cannot seem to agree on what needs to be done. It’s said that if you ask four different economists about the economy you will get at least five opinions. Right now the same seems to apply when asking UK Government Ministers their view on energy policy. The "Quad" of ministers is still debating the issue in the final run-up to the much anticipated Energy Bill. Meanwhile, the industry is reeling from a public disagreement between the Energy Minister John Hayes and Energy Secretary Edward Davey on the future of onshore wind in the UK. This was followed by the revelation that the Conservative MP Chris Heaton-Harris supported an anti-wind campaigner in the Corby by-election when he was supposed to be running the campaign for the official Tory candidate instead. To those of us getting used to the vagaries of political point-scoring in the Coalition, these spats may look like just part and parcel of day to day coalition Government. However, to the investment community (and especially the increasing number of foreign companies looking to invest for the long term in the UK’s supply chain) they can be unsettling.  

That is because, outside of Whitehall, in business, something interesting is happening. As government goes through the final negotiations before publishing the Bill, business opinion is settling on a shared viewpoint. 

Last week, the British Chambers of Commerce published a survey of 3,500 member companies. 90 per cent of them want the Government to ensure that the UK has a diverse energy mix, capable of avoiding future supply problems, and that the UK “must not find itself in a situation where it becomes more dependent on fossil fuels from overseas or on one technology at home”. 

In the same week as the BCC’s intervention, business leaders from prestigious organisations including Unilever, Kingfisher, EDF Energy, Doosan Power Systems, Heathrow Airport, Philips, Anglian Water and Johnson Matthey jointly wrote to the Prime Minister, expressing their concern that "the on-going divergence of views at the heart of government on the future of this sector…is paralysing investment and undermining the UK’s growth prospects". There have been similar letters and statements from companies as diverse as PepsiCo, Aviva, BT and Marks & Spencer. And recently seven of the world’s top energy companies – who employ 17,500 people in the UK alone – wrote to the Chancellor warning of political risk in current energy policy. 

Added to all this is RenewableUK’s own recent membership survey, in which almost two thirds of companies from the wind and marine renewables sector stated that policy was less favourable to the sector than 18 months ago. Despite this, 90 per cent of those organisations still expect to see growth over the next 18 months, showing the immense opportunity that clearer direction from government could unlock, as well as the furthering of the commitment that over 130 wind energy companies made to Britain via the Wind Energy Charter in May this year. 

For example, investment in offshore wind alone rose by 60 per cent last year. By 2020, the wind, wave and tidal energy industries alone are set to employ more than 88,000 people, from apprentices to highly-skilled engineers. That’s the scale of the prize on offer – as long as the all-important policy framework is right. 

The case being put forward by businesses, who are ready to make once in a generation investments into our economy, is based upon evidence and global trends. But we run the risk that these investments could be delayed. 

They hinge on the agreement of the UK Government’s Ministerial "Quad" – Cameron, Clegg, Osborne and Alexander – who are apparently set to meet to discuss energy policy. Over the autumn, business opinion has got firmly behind the view that our electricity sector needs to decarbonise. Such a shift will protect us against future price rises, open up investment in new technology and manufacturing, and support a new cornerstone of our economy – the green economy – which alone has delivered a third of the UK’s total growth in the last year. Sometimes business opinion settles on a realisation that future prosperity lies in a particular direction. Sometimes it is important that Government can agree that too, that’s why this Energy Bill is crucial for the sector.

Workers build an onshore wind turbine. Photograph: RenewableUK

Maf Smith is the Deputy Chief Executive of RenewableUK, the professional body for the UK’s wind and marine sectors, with 675 member businesses.

Ukip's Nigel Farage and Paul Nuttall. Photo: Getty
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Is the general election 2017 the end of Ukip?

Ukip led the way to Brexit, but now the party is on less than 10 per cent in the polls. 

Ukip could be finished. Ukip has only ever had two MPs, but it held an outside influence on politics: without it, we’d probably never have had the EU referendum. But Brexit has turned Ukip into a single-issue party without an issue. Ukip’s sole remaining MP, Douglas Carswell, left the party in March 2017, and told Sky News’ Adam Boulton that there was “no point” to the party anymore. 

Not everyone in Ukip has given up, though: Nigel Farage told Peston on Sunday that Ukip “will survive”, and current leader Paul Nuttall will be contesting a seat this year. But Ukip is standing in fewer constituencies than last time thanks to a shortage of both money and people. Who benefits if Ukip is finished? It’s likely to be the Tories. 

Is Ukip finished? 

What are Ukip's poll ratings?

Ukip’s poll ratings peaked in June 2016 at 16 per cent. Since the leave campaign’s success, that has steadily declined so that Ukip is going into the 2017 general election on 4 per cent, according to the latest polls. If the polls can be trusted, that’s a serious collapse.

Can Ukip get anymore MPs?

In the 2015 general election Ukip contested nearly every seat and got 13 per cent of the vote, making it the third biggest party (although is only returned one MP). Now Ukip is reportedly struggling to find candidates and could stand in as few as 100 seats. Ukip leader Paul Nuttall will stand in Boston and Skegness, but both ex-leader Nigel Farage and donor Arron Banks have ruled themselves out of running this time.

How many members does Ukip have?

Ukip’s membership declined from 45,994 at the 2015 general election to 39,000 in 2016. That’s a worrying sign for any political party, which relies on grassroots memberships to put in the campaigning legwork.

What does Ukip's decline mean for Labour and the Conservatives? 

The rise of Ukip took votes from both the Conservatives and Labour, with a nationalist message that appealed to disaffected voters from both right and left. But the decline of Ukip only seems to be helping the Conservatives. Stephen Bush has written about how in Wales voting Ukip seems to have been a gateway drug for traditional Labour voters who are now backing the mainstream right; so the voters Ukip took from the Conservatives are reverting to the Conservatives, and the ones they took from Labour are transferring to the Conservatives too.

Ukip might be finished as an electoral force, but its influence on the rest of British politics will be felt for many years yet. 

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