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‘Dishonest, irresponsible’: Shell lambasted for pulling out of world’s biggest wind farm

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‘Dishonest, irresponsible’: Shell lambasted for pulling out of world’s biggest wind farm

· Oil giant drops plan days after it reports £4bn profits
· Ministers urged to change policy to hit green targets

Terry Macalister
The Guardian, Friday May 2 2008

Shell was accused last night of being greedy and irresponsible as it came under ferocious attack from politicians and environmentalists for its decision to drop a commitment to the biggest offshore wind farm in the world.

Although the environment minister Hilary Benn called the decision to withdraw from the London Array scheme off the Kent coast “very disappointing”, the government was also under attack from opponents who saw the move as a body-blow to UK renewable energy policies. They called for more incentives to encourage wind developments.

Caroline Lucas, Green MEP for the south-east of England, said ministers should urgently reform their approach to clean power schemes and add so-called feed-in tariffs to its energy bill to encourage homeowners to join the fight against climate change. Under the tariffs, those generating electricity from renewable sources would be paid generously for any surplus power they feed to the grid.

She said Shell was a company motivated “purely by greed”.

“I cannot condemn Shell strongly enough for this shameful retreat from the London Array wind farm project. It appears that as the last key negotiations over equipment contracts took place, the company lost its nerve and decided to shun its responsibilities in the generation of green energy,” Lucas said.

“The loss of one of the three investors in the London Array wind farm is a serious setback for the future of renewable energy in this country, at a time when the UK is already struggling to meet its EU targets for renewables.

“Mere days after reporting first-quarter profits of £4bn, Shell has shown its true colours in what can only be described as a PR disaster for the company, and further proof that its media-friendly ‘greenspeak’ is both dishonest and irresponsible.”

Steve Webb, Liberal Democrat environment spokesman, believed Shell’s decision “blows a huge hole” in the government’s rhetoric about renewable energy.

Britain was already near the bottom of the European league table on green energy, and now a major investor had decided that other countries offered a better environment for wind power, he said. “If we are to meet our internationally agreed goals on renewable energy, the government needs a radical rethink … Only yesterday the Brown government faced its biggest ever rebellion over its refusal to back new incentives for small-scale renewable generators. Now a flagship wind farm has been undermined by the withdrawal of a major international investor.”

Shell declined to comment on Lucas’s remarks but said it still had its largest commitment to renewables and planned to build at least one alternative energy business by 2015. It also said costs at the London Array had soared by 45% since work started. The oil company was pursuing wind projects in the US rather than Britain due to the economies of scale and because planning permission was easier to obtain, a spokeswoman said.

Shell’s former partner, E.ON, which expressed its own concerns about Shell’s actions on Wednesday, indicated that the future of the London Array was in doubt.

Hilary Benn, environment minister, described Shell’s move as “very disappointing”, especially as it came just a day after the firm had notched up earnings of £2m an hour in the first quarter of 2008.

“I think a lot of people would want to understand why [Shell backed out], especially in a week in which the company has announced record profits,” he said.

Greenpeace chief policy adviser Benet Northcote attacked Shell for selling off its renewable assets “left, right and centre” while investing millions to extract oil from the Canadian tar sands, which he said was one of the most climate-wrecking forms of fossil fuel extraction known to man.

“Unless it puts its money where its mouth is and invests seriously in clean energy then Shell will rightly be known as one of the biggest climate villains on the planet,” he said.

Nick Rau, Friends of the Earth energy campaigner, was also concerned: “We’re very disappointed that Shell, which touts itself as a progressive green company, is pulling out … and leaving a key clean energy project high and dry.”

But the British Wind Energy Association, the industry trade association, played down Shell’s announcement, saying it was just “business as usual”.

Maria McCaffery, the association’s chief executive, said: “Consortiums come together to deliver large-scale wind farms and then often regroup at various stages of project development, for instance at the planning stage, or once the bids from subcontractors come in. This is common practice in the wind industry and has happened many times already.”

“The fundamentals of the project and the wider industry haven’t changed. We expect to see a great deal of industry interest in taking over Shell’s share in the London Array.”

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