UK: Former BP CEO says market is failing on clean energy
Date: 25 Mar 2009
Lord Browne, the former CEO of oil giant BP, has said that market mechanisms are falling well short of delivering the growth in renewable and clean energy that is required, and the government needs to intervene.
Low oil prices, high credit and other costs are combining to make many wind or solar schemes unviable as a straight commercial proposition. Whilst, he said, the market remains the most effective delivery mechanism available, it needs a new set of signals and framework of rules set by government.
Lord Browne told the UK newspaper the Guardian that planned massive expansion in offshore windfarms would not be realised in the face of the changing economic signals. Energy security and climate change mitigation are, he said, public goods and are not being recognised by companies operating purely in the free market. This was reflected in recent days by the announced decision by Shell to end its investments in wind, solar and hydro-electric power which was driven by the numbers.
It might fall to the utility companies and independents - not the oil firms - to develop renewables.
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In a recent article, the BBC's economics editor Robert Peston highlighted the fact that in 2012 the chances are that the economy - punch drunk as it is from the various flavours of debt crisis it has been pummelled with over the course of the year - will be hit by the collapse of a major bank and / or government.
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