Cost of playing power games

Why was a project previously regarded as a front-runner, which had attracted significant private investment and been rated the best scheme in Europe by the EU, suddenly being told that it was not worth supporting?

Was it, as many suspected, because of the political need to direct funds over the border to Scottish projects ahead of the referendum on independence? Or was it simply that, as the Government seemed to be suggesting and in spite of the South Yorkshire project’s obvious advantages, other schemes were better?

The answer, it now appears, may be neither. For, according to an unpublished Cabinet Office report, the so-called £1bn competition only has £200m available following a raid on its coffers by the Treasury.

In other words, the Hatfield scheme may have lost out because its advanced state meant that the Government investment would have been required immediately. The prize fund, however, would not have been topped up to £1bn again until the 2015-20 spending-review period.

If this is the wrong conclusion to draw, the Government must state explicitly the real reasons why the Don Valley scheme was rejected and stop hiding behind the rules of a competition the credibility of which is disappearing more rapidly than fossil-fuel emissions into the North Sea will do once Yorkshire’s CCS projects finally get going.

If the Hatfield project has really lost out on investment not because it was deficient in some way, but because it was more advanced than its rivals, then what sort of signal does this send out to the hosts of other green-energy schemes which the Government is supposedly trying to encourage and which, like Hatfield, promise jobs and economic growth as well as a low-carbon future?

The Government’s energy policy is already a confusing mass of mixed signals, with Energy Secretary Ed Davey and Chancellor George Osborne increasingly pursuing radically different agendas. But if the casualties of this power struggle are to include innovative schemes on which years of hard work and investment have been expended, then its consequences may be more damaging than anyone had anticipated.