Investment in Energy Infrastructure

Many people take as given a pressing need to increase capital investment in the infrastructure of our energy sectors - but how strong are the economic and social impacts of such investment? The LSE Growth Commission met this week to discuss this and I have brought together some of the arguments drawing on a number of various twitter feeds

Substantial investment is need in energy infrastructure in the UK going forward

Particularly in the electricity grid and in the natural gas pipeline infrastructure - UK a net importer of gas (increasing energy dependency?)

Investment is a necessary but insufficient condition to make significant progress towards a low carbon economy

Investment in renewables is growing - creating and protecting a significant number of jobs, especially in the north of England and Scotland and thus has the power to be a major driver of regional economic re-balancing

Promoting improved energy efficiency has high Net Present Values - pick the low-hanging fruit - cut emissions in the least cost way first

Stronger investment in renewable energy infrastructure makes the UK economy less vulnerable to macroeconomic shocks (global oil and gas price shocks in particular)

Too little of infrastructure acts as a severe constraint to growth - a long-term result of under-investment

Key issue is whether our energy industries / systems / networks have enough spare capacity to meet future demand - Economies of agglomeration in london, for example, were suported by the spare capacity of the then existing transport system

Many energy / transport projects with a high estimated net present value have not been undertaken - barriers are put in the way - the planning system acts as a huge barrier, local opposition, lack of fundamental political will to think long term and make key decisions, make and mend