A £50 green energy tax cut is good news. The bad news? Britain will have to …

December 1, 2013 by  
Filed under Green Energy News

David Rose

20:50 EST, 30 November 2013


20:51 EST, 30 November 2013

On Thursday, George Osborne will make an historic statement to the House of Commons. He will – at long last – announce a cut in ‘green’ levies on our household energy costs to take £50 off an annual bill.

From a politician whose party once said ‘Vote Blue, Go Green’, this is a remarkable  reversal.

The Mail on Sunday might claim some credit for it. This newspaper changed the context of the green taxation debate by revealing the inconvenient truth about global warming: despite the confident forecasts of climate computer models that underpin ‘eco’ policies, the world has stubbornly refused to heat up for the past 17 years.

On Thursday the Chancellor George Osborne will announce a cut in green levies which will reduce bills by £50

On Thursday the Chancellor George Osborne will announce a cut in green levies which will reduce bills by £50

We were the first to count out, penny by penny, what each of the main green levies cost you each year – from subsidising the windmill on your neighbour’s roof (£9) to the ‘renewables obligation’ (£36). 

And we led the way communicating ordinary householders’ views: a recent MoS poll showed 60 per cent of Britons oppose green levies on bills.

All this has made the conditions easier for Osborne to  make the first break from eco-maniac policies.

But this is no victory. Yes, £50 may be being cut from bills.  But astonishingly, there’s still another £300 billion of projected increases from green commitments to go.

They make Ed Miliband’s pledge to freeze bills meaningless. For this, we must thank primarily his own biggest legislative achievement – the passage, when he was Energy Secretary, of the 2008 Climate Change Act.

Here’s how its baleful arithmetic works. Under the Act, Britain is bound by law to reduce emissions of carbon dioxide by 15 per cent from their 1990 level by 2020.

It’s harder to cut emissions from transport and heating, so most of the burden falls on electricity.

The Department of Energy and Climate Change accepts there’s only one way to meet the target: to triple the proportion of power generated from wind, solar and ‘biomass’ (burning wood pellets imported from North America) from its current 11 per cent to 33 per cent in just six years.

This isn’t just a transformation of bewildering swiftness. It’s one of staggering expense. DECC’s official figures admit renewable energy subsidies will have cost £46 billion over the decade to 2020.

It’s likely to cost another £25 billion to connect the National Grid to all those offshore windfarms and other new installations.

Then we have what the Government’s current Energy Bill calls the ‘capacity mechanism’: yet another subsidy, this time for firms that own fossil-fuel power stations.

When renewable energy is available, those stations have to be switched off.

Without the subsidy, the plants would be so uneconomic they’d have to close. But they can’t close, because if the wind doesn’t blow – as in the month-long record freeze in December 2010 – the lights will go off.

Gordon Hughes, professor of economics at Edinburgh University, says the total cost of meeting the 2020 target will be substantially more than £100 billion. There’s only one way of funding it: from consumers, with £400 added to the average bill.

Closing fossil fuel plants without replacing them may cause blackouts by 2015 or 2016 with solar panels and wind turbines unable to fill the gap

Closing fossil fuel plants without replacing them may cause blackouts by 2015 or 2016 with solar panels and wind turbines unable to fill the gap

But we’ve still not scratched the surface of the eventual true cost of the great green leap forward. By 2030, the power industry is meant to be emitting just ten per cent – yes, a cut of 90 per cent – of the CO2 it does now.

The National Audit Office says doing this means bills will be £700 higher than now, but according to Hughes and other experts, the eventual total cost is mind-boggling: about £300 billion.

However, these vast increases won’t only affect your power bill. Two-thirds of electricity costs are paid by businesses.

To stay afloat, they will pass them on with higher prices for goods, adding to the pressure on households.

And finally, let’s not forget the 800,000 jobs which rely on ‘energy intensive’ companies. Many are certain to be lost: while UK bills soar, our competitors’ costs are falling – especially in America, where the shale gas revolution has caused energy prices to plummet.

The many powerful advocates of these policies insist they are essential to protect our grandchildren’s future. They also argue they will create ‘green jobs’ and give Britain a competitive lead.

Some of these apostles have grown rich from their beliefs, like the newly deselected Tory MP, Tim Yeo, chairman of the Energy and Climate Change Commons Select Committee, who has received more than £400,000 from his various green directorships since 2009.

But who are you supposed to believe? Last week  Oxford University’s Professor of Energy Policy, Dieter Helm, made a devastating argument to a House of Lords committee. He said America’s shift to gas has not only been an economic boon.

It’s also slashed its emissions faster than anywhere else, because modern gas plants produce less than half the CO2 of coal.

Yet UK green campaigners and politicians seem determined to leave our vast shale reserves untapped. He said: ‘If you want to go straight to nuclear or to renewables and miss out the gas bit in between, that entails an enormous investment programme and a massive increase in bills…

Evidence from America has shown that exploiting shale gas has slashed energy prices while reducing CO2

Evidence from America has shown that exploiting shale gas has slashed energy prices while reducing CO2

‘Conventional wind and conventional solar cannot crack climate change. There just is not enough land, surfaces and shallow water to make any significant difference.’

He added: ‘We have actually made no difference to climate change whatever.  You can argue that since [British jobs] have been offshored to more polluting places like China, we may well have made emissions worse globally while pretending that we have made them better here.’

China currently builds new coal plants equivalent to Britain’s entire power capacity every year.

If we are serious about climate change, we need a strategy that will work without reducing us to pre-industrial poverty.

New technologies, much closer to fruition than people realise, could do this much more cheaply: for example, power from nuclear fusion and reactors fuelled by thorium.

Yet both have been systematically starved of funds at the same time as we throw billions at wind. Helm concluded the current programme of closing fossil plants without replacing them may well cause major blackouts by 2015 or 2016: ‘What is going to fill the gap in 2017, 2018, 2019 and 2020?

‘There are not enough wind farms and solar panels to fill that gap in a credible way.’

By then, the political architects of this slow-motion catastrophe will not be in office.

But the time to avert it is now. The real battle is only just beginning. It will not be won by shaving £50 from energy bills


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14 hours ago

£50?! Is that REALLY the best they can do?! I simply don’t believe it.

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