Gas industry employee seconded to draft UK's energy policy

Documents reveal Decc's head of capacity market design comes from ESB, which owns three gas-fired power plants

A major state subsidy scheme for the UK's gas-fired power stations is being designed by an employee of a gas company working on secondment to the government, according to a document released by the Department of Energy and Climate Change (Decc).

The list of industry secondees, released to Greenpeace under freedom of information (FOI) rules, shows that the head of capacity market design at Decc is an employee seconded for two years from the Irish energy company ESB, which owns three gas-fired power plants in the UK.

A separate industry document names the employee as Fergal McNamara and describes him as the head of capacity market design at the ministry as well as being a "government representative". However, the ESB and Decc declined to confirm his identity when contacted by the Guardian.

The document also reveals that several other employees of big gas companies are working at senior levels within Decc, prompting criticism that there is an unhealthy closeness between the government and the big fossil fuel companies.

Green party MP Caroline Lucas said: "Ed Davey is trying to convince us that he's taking a tough stand against the energy companies. How on earth are bill-payers supposed to take him seriously when they get reminders like this of the cosy relationship between government and the gas industry?

"It's quite incredible that someone employed by a company that builds gas-fired power stations has such an influential role in government. Even more so given that rising gas prices are the main cause of energy bill increases in recent years."

The "capacity market" is a subsidy scheme aimed at encouraging companies to build new generator plants, to ensure that the lights do not go out as old and dirty power stations are closed down. It will pay millions of pounds to energy companies whether the plants are generating or not, in order to ensure that electricity is available when needed. The cost will be added to customer bills via a compulsory levy.

In October, David Cameron ordered a review of all the levies on energy bills in order to find ways to reduce costs to consumers. On Sunday, the energy and climate change secretary, Ed Davey, clarified the position, ruling out the possibility of scaling back programmes that help insulate the homes of people on low incomes. He said those green levies could be shifted into general taxation. "There is no way I could support any move which undermined our effort on either energy efficiency or fuel poverty," he told the Sunday Telegraph.

Capacity market payments are theoretically open to any energy technology but are expected to be dominated by gas plants, which are relatively fast to build and flexible enough to provide back-up for intermittent renewable energy. Four existing gas plants have already been mothballed owing to a lack of profitability, and a recent report from financial consultants EY, commissioned by the industry group EnergyUK, said 23,000MW of new gas generation has received planning permission but almost all is on hold "with owners waiting to see if the economic and policy environment become more favourable".

ESB said it was the only company currently building gas-fired generation in the UK and that its employee, a corporate regulation executive, was interviewed for the Decc role. He is paid a salary by taxpayers, which is topped up by the company. "Due care and attention was given to any perceived conflict of interest and it was confirmed that none existed," said a spokeswoman. "The opportunity to build a greater knowledge of the market arrangements from involvement in the Decc secondment programme is attractive to us."

Apart from the three power stations ESB already owns, the company has also begun building a £700m, 880MW plant at Carrington, Greater Manchester, and aims to build a 1,500MW plant at Knottingley in Nottinghamshire.

The FOI document revealed that three further energy company employees are or recently have been working on secondment at Decc. Shell is providing two staff, British Gas-owner Centrica one, and a ConocoPhillips employee recently completed an 18-month posting.

The Centrica employee, working as head of grid management strategy and provided to Decc for free, was previously a regulatory affairs executive at Centrica who "led a number … of political lobbying campaigns" and was "responsible for managing the impacts of industry and regulatory change for [Centrica Energy]", according to the employee's LinkedIn profile.

"It is perfectly normal practice for businesses to second experts in particular areas to government departments," said a Centrica spokesman.

A spokeswoman for Decc said: "Secondees bring with them knowledge and expertise which are vital to helping Decc do its job effectively. Decc ensures that any secondee is bound by the professional codes of practice relevant to their industry or services provided."

The contracts signed by secondees ask them to self-police any conflicts of interest. It states: "It is a condition of the secondment that the secondee ensures to the best of their ability that in the course of their duties for Decc there will be no conflict of interest or perception of such."

Greenpeace UK's deputy political director, Joss Garman, said: "When the government said it was going to take on the energy industry, we didn't realise that meant hiring their [staff] and letting them write the rules. This is a straight-up conflict of interest and the public are the losers, shut out of decision-making by the companies bleeding them dry with rising bills."

Commenting on the new revelations on the role of energy company employees in government, Tom Greatrex, Labour's shadow energy minister, said: "Industry has a role to play in helping government to ensure policies are workable, but handing over the detailed design of the capacity mechanism to [an employee of] a company with a vested interest in a particular outcome is remarkably complacent bordering on negligent. It is time energy secretary Ed Davey got a grip, so policies are implemented in the interests of consumers, rather than fuelling suspicions about the motives of secondments into Decc."

An earlier investigation by the Guardian showed that employees from other energy companies, including EDF and RWE npower, had been seconded to Decc. An analysis of declared meetings showed that there were 195 meetings between Decc ministers and energy companies and their lobby groups between the 2010 general election and March 2011. There were 17 meetings with green campaign groups.

Article Source : http://www.guardian.co.uk
Azure Global’s vision is to be widely recognized as a reputed firm of financial business advisors, achieving real growth for ambitious companies and to become the first choice for F&A outsourcing for accountancy practices and businesses alike and if u want to Setup ur business in United Kingdom then  its not difficult in this modern age for more info visit our site Azure Global and join us also On Facebook