The constant threat of bureaucracy, policy and tax interventions have stymied investment, warns the leader of one of Britain's largest energy producers.

Britain’s energy industry risks „death by a thousand cuts” as there are too many factors which deter investment, the head of one of Britain’s biggest power producers has warned. Tom Glover, the UK boss of the German company RWE, one of the largest energy producers, said that

Jeremy Hunt’s windfall tax and the lack of a clear growth strategy had put the company’s UK investment plans at risk. Only 3 billion of RWE’s 15 billion-pound British investment plans until 2030 have reached a final decision. The remaining 12 billion pounds is „up for grabs,” as he put it.

Mr Glover’s words came just a few weeks after Jeremy Hunt’s statement that cutting the tax burden on business was a „priority.” RWE is the second biggest power generator in the UK and provides around 15 per cent of all the country’s electricity needs. It has set out major plans for investment in UK offshore wind, but these plans seem to be slipping away.

However, Mr Glover said the constant threat of policy and tax interventions have not only stymied investment but also drastically pushed up operational costs. Still, it is the consumers who will feel the greatest impact on their energy bills. He added:

„If investments are more uncertain and more risky… either the investment doesn’t happen, or investors charge more. If we are stuck with the risk of tax, risk of policy intervention, then clearly when I go for my investment decision, my owners RWE will require a higher return. And if they require a return, ultimately the customer pays.

Other markets such as the United States and Asia are now looking more attractive for investment. In the US, the Inflation Reduction Act has already triggered a flood of investment by companies that will benefit from huge subsidies and tax breaks for green energy projects. Should RWE’s German headquarters decide to regroup some divisions, the UK could lose a very important energy company.

RWE is not the first energy company to warn about the threats of investing in the UK. Five energy trade associations wrote to the Chancellor this month to express concern that there is „no clear government plan to deliver green economic growth”.

For instance, Shell has recently announced that it is reviewing 25 billion pounds of investment it had earmarked for the UK.

Anders Opedal, chief executive of the Norwegian oil and gas company Equinor told The Telegraph that governments would have to incentivise future investments. Stable conditions for taxes will give the best investment environment going forward, he pointed out.

Former Tory leader Sir Iain Duncan Smith has also warned that the government „cannot go ladling extra taxes on what is already the highest tax base that we’ve ever had. We’ve already seen businesses leaving the UK, we cannot then give them another kick as they go out the door, that would just be the end for us.” Sir Iain has stressed that the government has to „start bringing down taxes on businesses and on individuals. Otherwise you’ll see next to no innovation left in the UK”.