U.K. Clean Energy Sector Shrinks After Government Subsidy Cutsby
Renewable energy and low carbon generated $52.5B in 2015
Sector accounts of 1.3 percent of country’s business economy
The U.K.’s renewable and low-carbon energy sector shrank by 8.7 percent last year, partly because of cuts to subsidies.
The sector, from wind farms to electric vehicles, turned over 42.2 billion pounds ($52.5 billion) in 2015, provisional figures by the Office for National Statistics showed on Friday. That’s lower than the 46.2 billion pound recorded in 2014.
Acquisitions of capital assets fell by 39 percent to 5.3 billion pounds in 2015, which ONS said was caused by fewer large scale purchases of solar panels and wind turbines. That’s likely caused by businesses anticipating a cut to renewable energy subsidies following the election of the Conservative government in May 2015, said Jennifer Webber, director of external affairs at the trade association RenewableUK.
“We’ve noticed there’s been a contraction in the market and unfortunately that’s had a knock-on effect in employment,” she said in a phone interview.
Full time employment in the sector fell by 2.3 percent from 2014 to 233,000, the survey showed.
The fall in numbers should be interpreted cautiously, a spokeswoman for ONS said. It was also caused by a revision to the methodology and a reduction in the survey size from about 40,000 businesses to about 14,000 this year.
The survey also found the sector in 2015 accounted for:
- 1.3 percent of the country’s business economy
- 1 percent of U.K. full-time business but non-financial jobs
- 3.8 billion pounds of exports
- 4.7 billion pound of imports