Ikea won't invest any of its £524m green energy fund in UK until Government backs renewables

Furniture company says it will take money elsewhere despite Britain being one of best places in the world to harness wind power because policies have made things 'difficult'

Swedish company says it has invested €1.5bn in renewables over last two decades (Stephen Chernin/Getty)

Ikea won’t spend any of its £524m green energy fund in the UK because government policies on renewables have made it “difficult” to invest, the company said.

The Swedish furniture giant reportedly says it has spent more than €1.5bn over the last 20 years on tackling climate change and has another half a billion to invest by 2020.

Joanna Yarrow, Ikea UK’s head of sustainability, told the Huffington Post that the UK’s “political context” does not encourage investment in renewables.

Ms Yarrow said that despite the UK being “one of the best places in the world” to generate wind power, Ikea’s fund would be taking its money elsewhere.

“I would say that over the last five or six years it has become increasingly difficult to invest in renewable energy production in the UK, and that for a large organisation like Ikea which has the resources to invest, it would be great for the UK to benefit from it,” she told the Huffington Post.

The Conservative government has scrapped a series of subsidies for green energy as it in a bids to save money.

Government financial support for on onshore wind turbines was ended in April 2016, one year earlier than planned. A report from professional services firm PwC found the UK’s solar industry lost around 12,000 jobs in the year to July 2016 after the number of installations plummeted as a result of cuts to government subsidies including the Feed in Tariff and the Renewables Obligation

In January, the Green Alliance, a renewables think tank, analysed the current pipeline of renewable energy projects and predicted that investment in wind, solar, biomass power and waste-to-energy projects will fall off a “cliff edge”, declining by 95 per between 2017 and 2020.

Alasdair Cameron, a renewable energy campaigner at Friends of the Earth, said Ikea’s refusal to invest in the UK should be a “major wake-up call for government energy policy.”

Recent policy changes mean the UK risks “falling behind the rest of the world in these crucial technologies”, Mr Cameron said, adding: “In the years ahead renewables will be among the most important industries in the world - its high time the UK government fully recognised their enormous potential.’’

Ikea’s global energy fund has so far helped construct 327 of its own wind turbines and almost 700,000 solar panels on top of its buildings around the world. The firm owns and operates three wind farms in the UK and Ireland.

A spokesperson for the Department for Business, Energy and Industrial Strategy said: “Britain is one of the best places in the world to invest in clean energy. Last year a record high £13bn was invested in renewables across the UK and in November we reiterated our commitment to spend a further £730m per year supporting new projects.”