Share

Tag Cloud

Bloggers

Blog

Fuel price hikes, green agenda to blame, and UK renewables investment set for a two-year go-slow…so what’s new then?

I hate to say I told you so but … I did.  Well, actually Adam Workman, partner at 350 Investment Partners, told me and I told you in the latest issue of Renewable Energy Focus magazine: investment decisions relating to the UK renewables market now face a two-year wait until after the elections, he warned.  And boy was he right.

The proof? How about Scottish & Southern Energy (SSE) chief executive Alistair Phillips-Davies confirming so in an interview with The Telegraph newspaper earlier this week? The utility will be “stopping all investment in offshore wind and new power plants until the 2015 election because of the acute political uncertainty around energy”, he said.

Following on from my interview with Workman, I can’t say I was surprised of course. But what got my attention to The Telegraph report – or let’s be honest here - what frustrated me about it, was Phillips-Davies staunch attack on financial support for renewables.

Using Labour leader Ed Miliband’s astonishing pledge to introduce a price freeze on energy bills if his Labour Party come to power (he’ll find that tricky to do) as the basis of his comments, Phillips-Davies spouted out the now familiar contention that energy tariff rises (such as the 8.2% hike his firm has just announced to its customers) are a result of levies imposed on utilities to pay for renewables and energy efficiency measures.

If they weren’t there, all would be fine with the world, suggested the man who’s company made £1.4 billion in profit last year. Interesting statements from a firm with a website tagline of "Renewable Electricity and Gas Supplier for Central and Northern England’.

“I doubt the public like price increases of this magnitude, but if we carry on firmly behind the green agenda we will continue to have price increases like this,” Phillips-Davies told The Telegraph.

“Maybe it’s time to retreat from decarbonisation and focus more on the cost of living. I think we have to have a debate about it," he said. "Do we want to be replacing one bit of [energy] generation that we can keep going for a bit longer with a new bit of generation that’s going to cost more?”

The Telegraph’s subsequent report (regrettably relying on figures calculated by the Renewable Energy Foundation, an organisation well known for its anti-wind agenda) has only compounded my frustration. SSE and the other companies which make up the “big six” energy companies in the UK received almost £900 million last year through green subsidies, the newspaper reports.

Clearly, some is for wind power, but it is just a fraction. In case anyone was interested, the bulk of the financial support through levies on household bills is for domestic energy efficiency measures for the elderly and low income households. Shame? Don’t think so.

The tone of the Telegraph report (and countless television news interviews I have since viewed) clearly suggested that these levies and green subsidies enable energy firms to cream off huge profits from wind power. Thankfully, RenewableUK was given the courtesy of refuting the claims, albeit tagged to the end of the story. But yet again I am left despairing at the mainstream media reporting of this industry.

As UK energy secretary Ed Davey said on the Andrew Marr Show, “People have got to understand what these green taxes actually are…Most of them are actually social policies to help the fuel poor manage their bills”.

Sadly, with the UK’s other big energy companies already starting to follow SSE with their own price rise announcements, I fear the wind industry in particular is in for a rough ride. But that’s nothing new. I just hope we see the industry speaking up loud and clear.

Perhaps more significantly I hope we see a little more balanced reporting from the mainstream media in the next weeks (and few years) to come – after all any rigorous, objective, independent analysis clearly shows that wind power is not the sole beneficiary of subsidies. Nor is it the main reason for price hikes.

Levies on energy bills are for a multitude of things including grid and transmission infrastructure needed generally for all power generation technologies. To blame the green agenda alone is ludicrous.

Gail Rajgor is a freelance editorial consultant and renewables analyst for Renewable Energy Focus. She was previously Managing Editor of the magazine and has worked in the energy media for 20 years.

Posted 18/10/2013 by Gail Rajgor

Tagged under: renewable energy , electricity , wind , wind power , wind energy , UK , alternative energy , wind farms , subsidy , subsidies , UK , price rises , UK energy policy

Comment on this blog

You must be registered and logged in to leave a comment about this blog.