Industry NewsEnergy companies have told the Government that they need to know this year the details of the planned energy market overhaul. Otherwise, there are warnings that there will not be enough time for the energy industry to take action to meet the scheme's objectives. Suppliers have also warned that the plans currently being suggested threaten to do more harm than good to the wholesale energy markets.
The Government has held a series of hearings with energy companies over proposed market reforms. New legislation is expected this year that could see major changes in the energy markets, with particular focus on the electricity sector. In order to both meet environmental targets and ensure security of supply, major investments are needed over the next few decades. There is a need for many new power stations, as well as a reinforcement of the supply system to aid the new connections. Among some of the changes suggested to support this move are price floors for carbon, enhanced emission performance requirements for generators and new tariffs to support renewable energy. The legislation is expected to be published in March 2011.
Talking to the Government, Southern Energy chief executive Ian Marchant, commented, "This year is crucial. If we haven't got clarity by the end of this year then the risk is that the momentum of that development starts to reduce." Adding a note of caution, Darren Braham, chief financial officer of First Utility, said, "There's a risk that some of the measures proposed will remove liquidity further down the curve."