Building more renewable energy capacity with public money would cost less than the current subsidy regime in the UK, a new analysis has found, despite government claims that subsidies are too expensive. Ministers have justified the slashing of some incentives to install solar panels, and ending support for onshore wind, on the basis that subsidising the construction of green energy was adding too much to energy bills. The government does not subsidise renewable generation directly but allows for incentives to some technologies through additions to consumer bills. But a pre-budget analysis by the Green Alliance thinktank has found that the current system – under which fossil fuel generation also receives extra support – is more costly than a simplified system that would favour renewables. The analysis comes as the government’s energy policy has been thrown into disarray by the potential collapse of its deal with the French state nuclear company EDF to build two new nuclear reactors at Hinckley Point. EDF’s finance director resigned over the issue, and the company is now seeking extra support from the French government to go ahead with the construction. This is despite the UK government’s agreement to pay EDF about twice the usual electricity price for its power. The Green Alliance urged the chancellor, amidst the resulting turmoil and uncertainty in the electricity market, to lift restrictions on new renewable generation, arguing this would be cheaper for the UK’s future energy supply.
Edie 14th March 2016 read more »