Greencoat UK Wind warns on RO reform impact; updates on capital plans
Update: 2025-11-12
Description
Greencoat UK Wind PLC (LSE:UKW) co-head Stephen Packwood talked with Proactive's Stephen Gunnion about the UK government's proposed changes to inflation indexation under the Renewables Obligation (RO) and Feed-in Tariff schemes, and their potential impact on investor sentiment and consumer bills.
Packwood said the government is considering switching the indexation from RPI to CPI, including the possibility of applying CPI retrospectively, which would effectively fix current RO levels for the next 9 to 10 years. He noted, “Retrospective changes such that this typically lead to an increase in the cost of capital.”
He warned that these changes could raise electricity costs and harm consumers, especially as energy demand increases due to the electrification of heating, data centres, and electric vehicles.
As an alternative, Packwood pointed to a voluntary Contract for Difference scheme, allowing generators to agree to fixed prices below wholesale levels, which could save around £30 annually per household. He said this would be “relatively fast and relatively simple” to implement.
He also discussed the company's capital allocation strategy, highlighting £220 million in disposals and nearly £200 million in share buybacks, along with debt repayments of over £100 million.
Visit Proactive’s YouTube channel for more interviews and insights. Don’t forget to like this video, subscribe, and enable notifications to stay updated.
#GreencoatUKWind #StephenPackwood #RenewablesObligation #EnergyPolicyUK #ROConsultation #InflationIndexation #ElectricityMarket #InvestorUpdates #WindEnergyUK #CleanEnergyInvesting #CapitalAllocation #ShareBuybacks #FeedInTariff #ProactiveInvestors
Packwood said the government is considering switching the indexation from RPI to CPI, including the possibility of applying CPI retrospectively, which would effectively fix current RO levels for the next 9 to 10 years. He noted, “Retrospective changes such that this typically lead to an increase in the cost of capital.”
He warned that these changes could raise electricity costs and harm consumers, especially as energy demand increases due to the electrification of heating, data centres, and electric vehicles.
As an alternative, Packwood pointed to a voluntary Contract for Difference scheme, allowing generators to agree to fixed prices below wholesale levels, which could save around £30 annually per household. He said this would be “relatively fast and relatively simple” to implement.
He also discussed the company's capital allocation strategy, highlighting £220 million in disposals and nearly £200 million in share buybacks, along with debt repayments of over £100 million.
Visit Proactive’s YouTube channel for more interviews and insights. Don’t forget to like this video, subscribe, and enable notifications to stay updated.
#GreencoatUKWind #StephenPackwood #RenewablesObligation #EnergyPolicyUK #ROConsultation #InflationIndexation #ElectricityMarket #InvestorUpdates #WindEnergyUK #CleanEnergyInvesting #CapitalAllocation #ShareBuybacks #FeedInTariff #ProactiveInvestors
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