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Green energy subsidies

It seems all political parties have now switched on, as it were, to that most electric subject for debate.  Energy prices.  Consumers – whether domestic or commercial - are now feeling the impact of their energy bills more than ever and the subject has become political hot potato which, interestingly, is also the method by which we will be heating our homes if we continue to run down the planet’s reserves of natural resources. In a popular and politically expeditious move, Ed Milliband has promised to freeze energy bills if Labour win next year’s General Election.  In response, the coalition government brought the controversial subject of fracking into the recent Queen’s Speech.  However, it is felt in some (green) quarters that overall, the government is now prioritising more expensive offshore solutions for wind generation, rather than considering the broader suite of energy options available.  Opponents argue that their resistance to more onshore wind farms is entirely down to the opposition from Conservative backbench MPs in their rural constituencies, who don’t want England’s green and pleasant land blighted by new armies of white windmills. Added to this already heady mix is the recent reduction in wholesale energy prices in the global market and the commensurate pressure from politicians for the Big Six energy companies to be transparent about passing those savings onto consumers... something they sometimes seem singularly unwilling to do. Now another voice has chipped in to the debate.  Richard Lloyd is the Executive Director of Which? magazine and he has written to the Energy Minister Ed Davey to detail his own reservations about the foregrounding of more expensive offshore energy generation.  In his letter, Lloyd argues that these higher cost options might not, ultimately, deliver value for money and further, that the government needs to consider more cost-effective options. Instead, Mr Lloyd suggests competition might be introduced between different types of energy technology, and between different energy companies to try to encourage competitiveness in the market, rather than providing a rather neat monopoly for the offshore wind sector.  Certainly 6000 people are already employed in the offshore wind sector, with the same number again indirectly employed.  Offshore wind is, therefore, a growth sector, already contributing significantly to a recovering British economy.  However the picture is more nuanced than the coalition government would perhaps like to accept.  For instance, the so-called “Contract for Difference” might also support low-carbon options such as carbon capture and storage, nuclear and other renewables, which might benefit both investors, and customers, with competition exerting a downward pressure on prices. Which? have always been known for their wisdom in choosing the best option, whether it be a toaster, DVD player, or choice of on or offshore wind generation.  Ed Davey would do well to listen, therefore, to Mr Lloyd’s advice.  Failing that, we could also look into harvesting the wind and hot air generated in the House of Commons itself, and perhaps find a way of harnessing that for the future energy needs of the nation.


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