As the UK seeks to implement its Paris promises to cut our emissions ministers are – we’re told – pursuing a “technology neutral” energy policy. In short, they don’t care what it is, so long as it works and doesn’t cost way more than the alternative. So we thought it worth asking the question: How well is the government currently doing when comparing the two most important options for low-carbon power: nuclear – and the contract for Hinkley Point C – and the suite of technologies called renewables? To define our terms a little – we’re principally looking at solar and wind, and at the central contracts grants (‘CfD’), although much of the insight could also be applied to the feed-in-tariff regime and to renewable tech like anaerobic digestion. I’ve tried comparing treatment across 3 areas, costs, risks and governance. And – because we’re geeky this way – we’ve compiled the results into 3 tables. Here’s the first one on costs: Governments are, of course, entitled to make choices. But what UK Government cannot do is argue that its preference for nuclear is anything other than a longing for its particular pet projects to go ahead, despite consumers paying greater costs, carrying higher risks and their administration being biased and incompetent.
Energy Desk 15th Feb 2016 read more »
The new Conservative government has made some progress in energy policy. In particular, the government has removed many roadblocks to the development of shale gas. However, this will not solve the immediate energy security crisis. Nor, incidentally, will the construction of the proposed Hinkley Point nuclear power plant, which is only due to come on stream in the mid to late 2020s. The government has been attempting to centrally plan Britain’s energy market. Market mechanisms have been squeezed out in favour of a system whereby the government determines the make-up of Britain’s electricity system. The consequences of this are two-fold. The first is that British energy consumers are footing the bill. Hinkley Point, for example, is set to be the most expensive conventional power plant in the world, according to well-respected energy analyst Peter Atherton. The second is that Britain’s energy security is being compromised. The government should urgently review how its interventionist policies are damaging the UK’s energy policy. A review of the UK’s unilateral carbon price floor, which forces British industry to pay a carbon price three times the level of their European counterparts, must be a priority.
City AM 15th Feb 2016 read more »