BP And Shell Dump Plans For Renewables In The UK Due To The U.S. Governments’ Tax Rebates And President-Elect Barack Obama
Delivering quite a blow to both Gordon Brown and Britain, BP has dumped its plans to build out wind farms and other renewable projects in Britain for projects in the United States. The US government incentives for clean energy projects provide convenient tax shelter for oil and gas revenues – something BP is looking for with an estimated $8 billion earmarked for the initiative.
[social_buttons] Convenience is another factor. BP, which has a representative on the ruling board of the British Wind Energy Association, said difficulty in getting planning permission and lower economies of scale made the UK wind sector far less attractive than that of the US.
“The best place to get a strong rate of return for wind is the US,” said a BP spokesman who confirmed the group would not bid for any offshore licenses.
Gordon Brown has promised to end impediments like this to ensure that Britain is a leader in the green energy revolution. But Shell has also pulled out of investing in Britain, noting similar difficulties. Both BP and Shell could have heavily influenced other investors: Fail!
Another reason for pulling the plug – Barack Obama. Shell noted that his promise to spend $150 billion over 10 years to kick start a renewable energy revolution is very appealing.
BP said about $1.5 billion would be spent next year on US wind projects and the company expected to spend the rest of the $8 billion up to the year 2015. The company is proceeding with some solar and biofuels projects, but they are mostly concentrating on wind.
BP expects to have one gigawatt of US wind power installed by 2008 and to have trebled that amount by 2010.
“The offshore wind market is evolving and getting stronger. Different investors will come and go at different stages of the development cycle. But whoever the players are, we know that the offshore industry will be generating massive amounts of electricity for the UK market in the next few years,” said a BWEA spokesman.
Sounds like someone’s grapes are sour. Don’t take it personally Britain. BP is also pulling out of China, India and Turkey — they just like us more.