Britain ‘needs long-term energy policy’

David Grey raised concerns about energy pricing and capacity, at a time when many manufacturers are battling to gain a bigger share of global markets.

Speaking before a press lunch at the Cutlers’ Hall in Sheffield, Mr Grey told The Yorkshire Post that energy pricing in the UK needed to be competitive.

He added: “We’re not saying competitive with Vietnam or China or Indonesia but, competitive with Germany, France and the US.

“We need that competitive pricing and we need capacity. We are regularly running at 96 per cent of the capacity. If you’re going to bend metal, no matter how efficient you are, you’re going to use a lot of energy and, if we want to be a manufacturing nation, we have to have that ability to use energy. There’s always a balance between the environment and energy. I don’t think they’re mutually exclusive. What the Government needs to do is start putting long term plans in place that gives us the capacity for growth. You cannot have growth in manufacturing and a zero gain in energy usage. It’s just not possible.

“That doesn’t mean that it has to be smoke stacks. It doesn’t have to be dirty energy, but we have also got to be relatively realistic. Windpower has got its part to play, but it’s not the be all and end all.”

In recent years, many manufacturers have raised concerns about the dangers of carbon leakage, which occurs when carbon dioxide emissions rise in one country as a result of stringent “green” policies in one of its neighbours. Last month, a report claimed that energy targets set by Brussels will force up annual household gas and electricity bills by £149 within six years.

European Union red tape, combined with a commitment to generate 15 per cent of energy through renewable sources, will push up domestic prices by 11 per cent, according to the Open Europe report. Britain’s small and medium sized businesses face an even bigger increase, with an average £350,000 rise, which is around 23 per cent, in bills, the pro-reform think tank said.

Mr Grey said he also appreciated the frustrations felt by many businesses about the lack of high speed broadband in parts of Yorkshire.

He added: “The inability to talk via Skype to a supplier or customer who is in China because your broadband can’t support it, is a real failing.”

Mr Grey acknowledged that Creative Sheffield, Sheffield City Council and the Sheffield City Region local enterprise partnership were working together to improve broadband speeds in South Yorkshire.

He added: “It’s a fundamental these days. You needs roads to get people in and out and to get goods in and out. You have to have digital highways so you can compete with the best in Europe.”

Mr Grey, who is the group managing director of OSL Holdings, said the economy was still facing challenging times.

He added: “They’re challenging financially, they’re challenging in terms of the skills that we need to grow, they’re challenging in terms of energy, and they’re challenging in terms of access to markets. There are great opportunities. The answers don’t just lie with Government...but I think the Government has to take a lead and point us in the right direction.”

In recent years, The Department for Energy and Climate Change has implemented reforms in the electricity market to stimulate investment into low-carbon home-grown forms of energy generation. The Government aims to open up the market to more competition, and it has also put in place measures to compensate energy-intensive industries.

To watch a video, visit www.yorkshirepost.co.uk/video.