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What do the investors say? The big blow to investor confidence came in September, when Labour leader Ed Miliband made his infamous energy price freeze pledge. Centrica and SSE both took a sustained hit to their share prices. Since then, the Conservative backlash against "green levies" and energy secretary Ed Davey's hints that Centrica should be broken up have only turned up the heat. Liberum Capital analyst Peter Atherton said UK power companies "risk becoming uninvestable". By the time Ofgem last month ordered a competition investigation, the industry was almost grateful. It has its risks but at least it is not run by politicians. SSE pre-empted the competition referral with a surprise move to voluntarily freeze prices until "at least 2016". That aggressive action scored SSE points politically and gave the share price a boost, albeit not to pre-September levels. However, it also bore out the prophecies of reduced investment, funded as it was by slashing offshore wind projects. SSE's price freeze prompted speculation Centrica would have to follow suit, triggering a downturn in latter's share value. UtilitY WEEK | 11th - 17th April 2014 | 21 Policy & Regulation whether that is enough to keep them on the system. Meanwhile, there is huge uncertainty over the future of coal plant, which currently meets 40 per cent of UK demand. European legislation requires coal generators to meet tougher emissions standards if they are to stay on the system in the longer term. Under the capacity market, they can get contracts of up to three years to help boost the invest- ment case for clean-up kit. The Treasury's recently announced carbon tax freeze also favours coal generation. However, a lot will depend on changes in the coal, gas and car- bon prices in the next two years. There will also be chances for demand- side operators to bid into auctions in 2015 and 2016, but it is not yet clear what contri- bution this is expected to make. Between National Grid's reserves and the capacity market, it looks like blackout fears are overblown. Laidlaw was making a more nuanced point, that uncertainty will delay investment. Basic economics dictates that the tighter the market gets, the higher prices will go. One way or another, the consumer pays. As politicians fixate on energy prices, they cannot afford to ignore security. What's in anD What's Out Key Wind, offshore Wind, onshore Tidal Biomass Hydro Pumped storage Nuclear Oil GT CCGT Coal Reference Scenario 2012 Key Additional wind, offshore Additional wind, onshore Additional biomass Additional CCGT Closures biomass Closures nuclear Closures oil Closures GT Closures CCGT Closures coal changes in installed capacity by generation technology type in the Reference scenario installed capacity by generation technology type in the Reference scenario 2014/15 2014/15 2013/14 2013/14 2012/13 20115/16 20115/16 2016/17 2016/17 2017/18 2017/18 2018/19 2018/19 Capacity (GW) Capacity (GW) 100 80 60 40 20 0 6 4 2 0 -2 -4 -6 1620 1520 1420 1320 400 280 360 340 320 300 centrica sse 1 April 2013 1 April 2014 1 April 2013 1 April 2014