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‘Heavy-Handed Green Policies Are Behind Planned Factory Closure’

Heavy-handed Government policies to encourage green energy use are behind the planned closure of Spondon’s Celanese Acetate plant.

That is the view of one energy expert, who says that official concern for the environment has pushed up power prices in this country.

And Dr Benny Peiser, director of Global Warming Policy Foundation, says that these aggressive policies to promote renewable energy will cripple other heavy industries in the UK in the same way.

The Derby Telegraph revealed yesterday that the plant’s American owner, Celanese Corporation, is consulting with staff over proposals to close the site next year to concentrate production in Belgium, the US and Mexico where power is cheaper.

UK energy prices have rocketed by 16.7% in the last year against an increase of just 3.8% in the European Union.

Dr Peiser says the price hike is due to energy policies devised in the corridors of power and he points the finger at the three main political parties who all agree on measures taken to make renewable energy more competitive.

“The UK has acted unilaterally to introduce [green] taxes and the obligation for firms to buy a certain proportion of their energy from renewable sources which makes power here 20% more expensive than in other countries,” said Dr Peiser.

“If energy accounts for only 5% of a company’s total costs, paying 20% extra is achievable.

“However, if 20% of a firm’s costs are energy-related then it’s make or break time.” […]

The UK is committed to at least an 80% reduction in greenhouse gas emissions by 2050.

Higher taxes are to subsidise more expensive renewable energy and industry is made to get a proportion of its power from renewable sources.

The closure of Celanese Acetate would result in the loss of 460 jobs and bring to an end almost 100 years of acetate production at the factory, which once employed 20,000 people.

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‘Energy prices could drive more firms out of the UK’

THE closure of the Celanese Acetate factory in Spondon, blamed on high UK energy costs compared to other countries in Europe, is not an isolated incident.

Last year, 540 jobs were lost at Anglesey Aluminium Metal when its owners failed to find a competitively priced energy supplier in the UK.

Closer to home, 50 jobs were cut at BOC in Derby when the German owners of the gas producer closed its factory.

The Raynesway site no longer produces acetylene, formerly its core product, and employs 25 people selling bottled gas and welding equipment.

General manager Bob Bunn, who has worked for BOC in Derby for 38 years, says high energy prices were a factor in the closure of the factory, following its purchase by German firm Linde in 2006.

Mr Bunn said: “The factory produced acetylene which is used as fuel for welding.

“The process is very energy-intensive, using a lot of electricity, so energy prices, as well as falling demand for acetylene, were factors in the decision to close.”

Celanese Acetate is one of many factories that have struggled to cope with its energy bills in recent years and, according to representatives of heavy industry, it is a situation likely to get worse.

The Energy Intensive Users Group, representing the interests of industries that use large amounts of power, believes its high cost here will cost more UK jobs in the future.

Jeremy Nicholson is a director at the lobbying group which puts pressure on Parliament and power providers to make sure UK industry pays fair prices for its energy and can remain competitive internationally.

He said: “The UK is missing out on foreign investment because its energy prices are uncompetitive.

“This has already forced manufacturers out of the UK and more are likely to follow.

In the next 10 years, the organisation expects energy prices to increase by between 60% and 70%, partly due to the UK’s aggressive climate change targets and partly due to our increased reliance on imported gas, a result of the closing of gas-fired power stations and the decommissioning of older nuclear power stations.

“Contrary to popular belief, we’ve not lost all of our manufacturing industries,” said Mr Nicholson.

“They have become much more labour-productive and more efficient to survive but cannot do anything about uncompetitive energy prices.”

The group argues higher subsidies in the UK for renewable energy are effectively paid for by heavy industry through taxation via the climate change levy, and an obligation to buy a proportion of its power from renewable sources.

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