UK energy sector attracts major investment

The government has announced that GDF Suez (GSZ) and BP Plc (BP/) will invest more than £1.5 billion in the UK as part of a government effort to support the economy and lure companies to pay for upgrading the nation’s energy infrastructure.

GDF Suez of Paris, the largest European power generator by market value, along with London-based Centrica Plc (CNA) and Bayerngas GmbH of Munich plans to develop an 18 billion-cubic-meter gas field under the North Sea, the U.K. Department for Business, Innovation and Skills said.

George Osborne went on to say that “The UK can lead the world in the energy sector….The government is committed to creating an environment in which innovation can thrive and business can grow.”

The announcement came after an investment conference attended by company executives including BP Chief Executive Officer Bob Dudley, Royal Dutch Shell Plc (RDSA) Chief Energy Adviser Wim Thomas and Andrew Gould, chairman of BG Group Plc.

Dudley said he expected world energy demand to rise 40 per cent by 2030, which “is the equivalent of another whole China being formed and another whole United States. Partnerships with academic institutions are vital to progress, and with Britain having so many world-class university departments, it’s no surprise that we spend about 40 per cent of our R&D spending here,” he said at the meeting.

Plasma gasification plant to be first of many

It has also emerged that Air Products' 50 MW plasma gasification facility on Teesside could be the first of many advanced waste gasification facilities to be built in the UK.

According to NNFCC the facility will use AlterNRG advanced gasification technology to turn 350,000 tonnes of residual waste into enough renewable electricity to power up to 50,000 homes every year.

"Following our work gathering evidence for the Renewables Obligation banding review, we are delighted to see these ground-breaking advanced gasification projects starting to go ahead," explained Dr. Geraint Evans, head of biofuels and bioenergy at NNFCC.

Impact on business energy

For businesses in the UK and around the world the cost of energy is an important factor. For some businesses the cost of energy is incredibly important and will dictate the profitability. The announcement of industry investment into the UK energy market is ultimately a good thing for businesses as energy providers will improve their infrastructure and supply of energy making it more affordable.

This will not happen overnight. This kind of investment will take time to come into fruition however it demonstrates that the energy industry is investing in itself and the future. As this process will take time it is essential for businesses to ensure they are using the most competitively priced energy providers and measures such as half hour meters.