Renewable energy investment drops to 11-year-low hit hard by George Osborne's scrapped green energy tax exemption

Clara Guibourg
Follow Clara
Wind and solar power
Green energy investment fell by 48 per cent compared to last year (Source: Getty)

European investment into renewables has tumbled to an 11-year-low, as policy changes in the UK have pummeled green energy growth hard.

European countries invested a total of £3.8bn into renewable energy over the past quarter - leaving investment down 48 per cent compared to the same period last year.

Although this is partly explained by a natural lull in investments, following three large offshore wind deals totalling £2bn in the second quarter, Angus Crone, senior analyst at Bloomberg New Energy Finance said that the large drop also follows on recent changes in government policy that have struck against green energy:

Support policies have become less friendly to wind and solar investors in several countries, including Italy, Germany, Denmark and, most recently, the UK.

Chancellor George Osborne announced in his July Budget that the government would be scrapping a green tax exemption enjoyed by renewable energy companies since 2001. Green energy firms’ shares took an immediate dive on the move, which was loudly criticised by environmentalists.

UK renewables have quadrupled since 2000, accounting for some 5.6 per cent of the country’s total energy use. This still leaves our green energy use lagging far behind the EU average, which stands at just over 15 per cent.

The latest investment figures follow on yesterday’s news that wind power has become the UK’s cheapest electricity to produce.

Related articles