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Daily Telegraph: Renewable energy ‘will struggle to pay its way

Daily Telegraph: Renewable energy ‘will struggle to pay its way

Thursday 23 June 2005

By Christopher Hope (Filed: 23/06/2005)

Renewable energy would not be able to pay its own way for at least 10 years, Shell admitted yesterday.

Jeroen van der Veer, Shell’s chief executive, said wind power was only profitable because of generous Government subsidies, while solar power broke even on a cash basis.

He said that Shell treated its renewable energy investments equally, pouring resources into whichever started to look promising.

“The philosophy is pots on the fire: try everything and, by 2015, we should have to make up our mind,” he said. “If one of the pots starts to boil, we will increase the size of the pot.”

For that to happen, it would have make $250m profit a year, he said. Shell was making a bet on renewables which would not pay out for decades, he admitted.

“Even in 2015, renewables will take off later. It is still too expensive. Longer term you will see that technology will help to move costs down. You have to take a 50-year horizon when one will be getting cheaper. So you better join the game now.”

Shell was appointing a “Mr or Mrs CO2” to report to the board on Shell’s plans for dealing with carbon dioxide emissions.

The company predicts that, by 2050, one third of total energy consumption will come from non-fossil fuels, including nuclear energy, “from a very low percent now”. He added: “Long-term out there is a big renewable market. What will it be? We don’t know.”

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