The UK government has revealed plans to double its target for electricity generated through renewable energy for 2020. This bodes well for the wind industry for the purpose of long-term investment decisions.

UK intends to hike the share of electricity supply generated through renewable energy (RE) to 20% by 2020, which would be twice its previous target of 10% by 2010, as published by the China Post.

UK government has come out with the RO (Renewables Obligation) to offer a benchmark for monitoring the quantity of energy that the suppliers are required to provide through green or RE sources by 2010. Plans have been revealed by the government to increase financial backing for developing RE and the objective of another increase in the RO level. The expectation is that this will result in adequate renewable energy’s development to provide power for nearly three million more homes.

The expansion of the RE market in the UK is being fuelled by two factors. The first is the need to locate additional primary energy sources due to the decline in the output of UK’s indigenous oil and gas. Renewable energy contributions would help ease growing reliance of the UK upon imported fossil fuels. Consequently, it would minimize the chances of disruptions to the energy supply of UK resulting from international politics or global market forces. The second factor involves the lack of carbon-dioxide emissions from most renewable energy sources including hydropower, wind power, wave power and solar power. This would enable the UK to fulfill its environmental obligations as per the Kyoto Protocol.

Wind power is expected to provide maximum part of fresh ‘green’ energy with plans for fleets of off shore wind farms around the coast in UK. The implication of this is going to be extremely favorable for wind industry. Ability to evaluate renewable power for another five years would boost confidence in the industry when it comes to long-term investment choices. More crucially, it is also a clear indication of the intention of the government regarding its goal of 20% by 2020.

A RNCOS research analyst is of the view that UK has over 50% of Europe’s wind resource plus the maximum potential for wave and tidal stream power in Europe. It’s expected that the renewable energy market in UK will grow an annual rate of 22% and exceed US$ 30 Billion by 2020. Despite rapid growth in renewable sources output to meet the 2010 target, acceleration in expansion of the volume of renewable energy plant is called for, in order to reach the 2020 target. 

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