The waiting game

Following the publication of the Energy Bill and the chancellor's Autumn Statement, Paul Suff laments politicians' habit of passing the buck to future administrations when it comes to tough policy choices

Governments tend to put off taking difficult decisions. Procrastination is particularly common when those charged with finding a way forward are totally split on the best course of action. In the US, this situation is referred to as “kicking the can down the road”. In the UK, postponing a decision is described as “kicking it into the long grass”.

The procrastinators are either hoping the road is ever winding or the grass too long, allowing them defer indefinitely, or they’re waiting for someone else to take the decision – which, to apply another US idiom, is called “passing the buck”.

The absence from the Energy Bill of a decarbonisation target for the energy sector is a classic case of “kicking the can down the road” and, potentially, “passing the buck”. Rather than providing the certainty craved by investors in low-carbon generation by setting a target for 2030, the government has postponed the decision until 2016 – after the next general election.

The coalition – one half of which was keen to set a target – has justified the delay by saying a decision in 2016 will coincide with the setting of the fifth carbon budget, from 2028 to 2032. But that ignores the fact that the government has already placed a question mark against the “agreed” fourth budget, after the chancellor wrangled from his coalition partners an agreement to review the budget in 2014.

So, rather than create the right climate for investment, the Energy Bill has simply prolonged the uncertainty that already existed around energy policy. Do you put your money into developing renewable generating capacity, into cheaper-to-build gas-fired power plants or take your money elsewhere?

The answer will largely depend on who wins the 2015 general election. Labour and the Liberal Democrats have both signalled their intention to set a decarbonisation target, whereas the Conservatives – at least on current viewing – appear to favour a second dash-for-gas, which would render any target pointless and risk breaking the carbon budgets.

Of course, the outcome of the next general election, like energy policy, remains uncertain.