Norwich Union says high gas and oil prices boost renewable energy sector

Article date: 7 February 2006

The team that manages Norwich Union’ssocially responsible investment (SRI) funds believes high gas andoil prices will help drive returns in the renewable energysector.

High energy prices, concerns about security of supplies and theintroduction of the EU Emissions Trading System* (ETS) makerenewable energy companies look more attractive. The cost ofelectricity generated by wind power is now comparable toelectricity generated from gas, and the recent increase in gasprices further enforces the economic viability of wind.**

Clare Brook, director of socially responsible investment forNorwich Union, said: “Cheap fossil fuels are becoming a thingof the past, but this puts the focus on renewable energy and energyefficiency sectors. As these sectors thrive, they create greatinvestment opportunities. We have been investing in alternativeenergy companies, companies that promote energy efficiency andhousebuilders that specialise in energy-efficient homes. Severalpower companies such as Scottish Power and Scottish and Southernare diversifying into alternative energy.”


Press office contacts:

David Gwyer 01904 452828 Out of hours 07800 699508
James Evans 01904 452791 Out of hours 07800 699525
Rob Pell 01904 452659 Out of hours 07800 699563
Cheryl Cox 01904 452617 Out of hours 07800 695275

* About the EU Emissions trading System
The EUEmissions trading System started in January has placed a cap on theamount of CO2 that companies (including power generators) can emit.If companies can not meet their reduction targets, they are forcedto buy CO2 credits from other companies. The result has been toattach a cost to emitting CO2, which is passed on to electricityusers. Carbon is currently trading at about 20Euro a tonne.

** Electricity from wind power costs about EUR cents 4-12 /kW hour,UK gas stock electricity prices historically cost circa EUR cents3-6 /kW hour; the recent rally has gas stock electricity up tocirca EUR cents 7-8 /kWh.

About Norwich Union’s sociallyresponsible investment team
Norwich Union has sevensocially responsible investment funds. Its socially responsibleteam is based at Morley Fund Management and is one of the largestand most experienced in the UK. The team is lead by PeterMichaelis.

Notes to editors:
Norwich Union is one of theUK's biggest life insurers. It is a leading provider of life,pensions and investment products and one of the largest FinancialAdviser (FA) providers. FAs provide over 70% of the company'slong-term savings business in the UK.

Norwich Union has strategic alliances with building societies andother leading UK brand names including CIS and The Royal Bank ofScotland Group. Norwich Union’s news releases and a selectionof images are available from Aviva's internet press centre

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