Member Article

Energy plans indicate investment in low-carbon

The Government has published some details of its much anticipated Energy Bill, which states £7.6bn will be invested in low-carbon electricity infrastructure by 2020.

Decisions over carbon cutting targets will be delayed until 2016, as the Government aim to generate £110bn investment in new infrastructure.

The Renewable Energy Association said the impact on bills had been “wildly overstated” and suggested that households will be “investing directly in the development of UK jobs and enterprise.”

The Department for Energy and Climate Change said costs to average households in 2020 will be around £95 or 7%.

Details revealed by the Energy Secretary Ed Davey, indicate that a “Gas Generation Strategy” will put paid Lib Dem desires for more clean energy.

Energy and Climate Change Secretary Ed Davey, said: “This is a durable agreement across the Coalition against which companies can invest and support jobs and our economic recovery.

“The decisions we’ve reached are true to the Coalition Agreement, they mean we can introduce the Energy Bill next week and have essential electricity market reforms up and running by 2014 as planned.

“They will allow us to meet our legally binding carbon reduction and renewable energy obligations and will bring on the investment required to keep the lights on and bills affordable for consumers.”

Lord Deben, Chairman of the Committee on Climate Change, responded by saying: “The agreement on the levy control framework is very positive. This should be sufficient to support investments in renewables required to meet the 2020 EU target and carbon budgets, together with demonstration of CCS and investment in nuclear new build.

“We are disappointed that a carbon intensity target will not be set until the next Parliament. This leaves a high degree of uncertainty for investors and does not address widespread investor concerns raised in recent months; it could adversely impact on supply chain investment and development of projects to come on line after 2020.

“It is essential now that delivery of the Electricity Market Reform proceeds on the basis that this is aimed at achieving early decarbonisation of the power sector, which is the economically sensible path in a carbon and resource constrained world.”

John Cridland, CBI Director-General, added: “This package will send a strong signal to investors that the Government is serious about providing firms with the certainty they need to invest in affordable secure low-carbon energy.

“We now have political agreement on this critical issue and the Government should get the bill on the statute books as quickly as possible.

“As more details emerge, the Government should ensure that those households and businesses most vulnerable to increased energy prices are protected.”

Clare McNeil, IPPR Senior Research Fellow, commented: “This announcement from Ed Davey goes some way to making sure Britain will keep the lights on, but leaves the door open for greater reliance on expensive gas.

“The Energy Bill will give investors and the market some of the assurances they have been craving, with a clear commitment to the UK achieving just under a third of its power from renewables by 2020. But 2020 is already in the rear mirror for many investors and businesses.

“The litmus test of this Energy Bill was a commitment to a 2030 decarbonisation target for the power sector and on this it has failed.

“Kicking this decision into the long grass and leaving the door open for changes to the UK’s fourth carbon budget and a ‘dash for gas’ will leave the government’s energy policy mired in exactly the kind of uncertainty it needs to avoid.

“Greater dependence on will only lead to higher and more volatile energy bills, at a time when government needs to be doing far more to keep these low.”

This was posted in Bdaily's Members' News section by Tom Keighley .