Households will be paying £100 more for their annual bills within five years to fund four government policies designed to keep the lights on and support low-carbon electricity, according to a review. Independent consultancy Cornwall Energy said energy subsidies will have risen by 124% by 2020-21 due to the cost of the capacity market, renewable obligations, contracts for difference and feed-in tariff schemes. The cost estimates will anger Conservative backbenchers opposed to subsidising green energy, even if it is designed to play a key role in the fight against climate change. “While the future path of wholesale prices remains uncertain, policy costs are moving only in one direction,” said Jo Butlin, the managing director of Cornwall. “Our research shows a confluence of factors serving to push these costs up notably in the next couple of years, though important drivers that could yet change the outlook remain beyond anyone’s control.” Cornwall estimates that three of the renewable energy subsidies, excluding the capacity market energy security scheme, will have cost £7.7bn by 2020 – £100m more than the spending limit of the levy control framework.
Guardian 20th May 2016 read more »