World solar's week in the sun

Wind may not be the 2013 renewable energy winner for installations but it will remain a leading technology thanks to falling equipment costs, new markets and the growth of the offshore industry. Indeed, on Friday, Mitsubishi Heavy Industries and Vestas Wind Systems announced they had agreed to form an offshore wind joint venture. The partnership, to be formed in March 2014 and equally owned by the two companies, will design, procure, build and sell offshore wind power plants. Having been unprofitable for two years, Vestas is seeking to lower fixed costs by €400 million ($US540 million) and expand its foreign business. It will move development of its 8MW sea-based turbine to the venture and the Japanese company will inject €100 million, rising to €200 million based on milestones met. Wind did have a record of its own last week, with Friday producing the first ever IPO of a US wind developer: Pattern Energy raised $US352 million after shares were priced at $US22 each and opened at $US24.10 on Nasdaq, touching a high of $US24.30 later that day. Pattern owns and operates eight wind projects in the US, Canada and Chile. Its IPO success could spur other such filings. Meanwhile, the leader of the UK Labour Party, Ed Miliband, stirred up a hornets' nest on 24 September by announcing that, if elected in May 2015, his party would cap gas and electricity prices until January 2017. The proposal would cost energy companies £4.5 billion ($US7.2 billion) but would save an average family £120 ($US193) a year, Miliband's office said without saying how it had made the calculations. In addition, Labour's energy spokesperson, Caroline Flint, told delegates at the party conference that if elected, it would split up Britain's six largest gas and electricity companies and force them to trade all their power on the open market to drive down prices.

The UK is not the only European country where governments are concerned that consumer energy prices are too high: Hungary's conservative government recently announced its intention to renationalise utilities for that reason. Retail tariff controls – disliked by the European Commission – are not uncommon in the region. Indeed, the average household electricity bill in the UK has risen 68 per cent since 2008, though the nation's power prices are the fourth lowest among 15 EU countries according to a study by the Department of Energy and Climate Change.

In response to Labour's announcements, the industry has said that the freeze on prices could deter investment in new power capacity, which the regulator Ofgem has said is necessary to avoid blackouts towards the end of the decade. Miliband's proposals backtrack on Labour's support for Prime Minister David Cameron's energy policy, which is designed to attract £100 billion ($US175 billion) for replacing older power stations. The profitability of European power generators is under pressure from multiple angles. The region has begun to see utilities announce capacity reductions, albeit to a large extent involving mothballing rather than permanent closure. Some UK utilities have also said the government's clean energy policies are to blame for the rising consumer electricity bills. Low-carbon policies will make up around a fifth of the domestic electricity price in 2020 – double the current level of 10 per cent – according to Bloomberg New Energy Finance.