Scotland - fantasy energy??

[CliveH]

Interesting article in the Telegraph. Interesting in that this is the first time I have seen someone with real economic know-how stand up and tell a bunch of politicians that their proposals are dangerously wrong.

 

Good article - most of it cut and pasted to here because it is so good. But full article at

 

http://www.telegraph.co.uk/news/uknews/scotland/9301048/Alex-Salmonds-46-billion-green-gamble-with-Scotlands-economy.html

 

 

By Simon Johnson, Scottish Political Editor6:00AM BST 31 May 2012

 

Peter Atherton, Citigroup’s head of utilities research, said the SNP’s radical renewable power targets require up to £7 billion of investment a year but the figure at the moment is only £750 million.

 

It is “borderline fantasy” that this difference can be made good because banks and international investors do not think green energy schemes provide reliable returns, he said.

 

The industry expert, who advises the bank's clients where to invest their money, said utility share prices are “dire” and green energy manufacturers have proved a “terrible, catastrophic investment” in recent years.

 

Mr Atherton’s evidence to Holyrood’s economy, energy and tourism committee infuriated SNP MSPs but he warned there will only be a market for green energy if oil and as prices remain high in perpetuity.

 

“You are making a bet that fossil fuel prices will continue to rise greatly forever, so you are taking a very long position on oil,” he said.

 

“And you are betting that the consumers of the UK generally, or somewhere else in Europe, will be willing to pay for all this. Those are two big bets. - “I’m not sure I’d bet £45 billion on it and I’m not sure I’d bet the economy of Scotland on it. You might want to slow down and see whether those assumptions turn out to be right.”

 

He said no one knows what fossil fuel prices will be in the middle of the next decade and it is not inevitable they will increase, adding there are numerous examples of people wrongly predicting this over the last 40 years.

 

Mr Salmond has set a target of generating the equivalent of all Scotland’s electricity from green sources by the end of the decade.

 

Citigroup estimates this will require between £6 billion and £7 billion a year being spent on new power projects but Scottish Renewables, the industry body, has confirmed only £750 million was spent last year.

 

Describing the available finances for green power as “grim”, Mr Atherton said: “Utility company share prices have been dire, struggling. The renewable manufacturing companies are terrible, catastrophic investment.

 

“I’m not saying that this will last forever but where we speak today the idea that the capital markets are going to double, triple and quadruple their exposure to this, given the performance over the last three or four years, is borderline fantasy.”

 

 

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It did not go down well it seems. B-)

[Guest pelmetman]

If they want to do something useful.........they want to build a few coalfired power stations and open up some of the mines they closed...........then they'll be part way towards being energy self sufficent and create a lot of jobs ;-) .................and give a few greenies apolexy (lol) (lol)