Since the Conservative party took complete control of the United Kingdom’s parliament three months ago they have revealed their true colours on energy policy and outraged many environmentalists. The party under David Cameron, who five years ago promised “the greenest government ever”, is now firmly headed in the opposite direction.
The basic trend seems to be a preference for large scale projects, offshore as opposed to onshore wind, wholesale and widely unpopular support for fracking, the oil industry and nuclear power. The biggest losers are energy efficiency in the home, onshore wind and solar power.
This is in complete contrast to the wishes of the British public, as identified by consistent polling, which is against fracking and for renewable energy.
In March 2015, in the government’s own survey, nearly four-fifths of the public (78 per cent) said they supported the use of renewable energy to provide the UK’s electricity, fuel and heat. This was broken down into offshore wind (73 per cent), biomass (63 per cent), onshore wind (65 per cent), wave and tidal (74 per cent) and solar (81 per cent). On fracking, only 24 per cent have said they support it and only 39 per cent support nuclear energy.
But the U-turn in policy is consistent with the Conservative tendency to listen to lobbyists from the nuclear and oil industries and to vocal campaigners from within rural conservative MPs’ constituencies who dislike wind turbines. At no point within the previous government did Chancellor George Osborne entertain lobbyists from the renewable energy industries.
British energy policy has long suffered from a lack of consistency, frequently lamented by the industry, which says it needs predictability in order to plan investment. Delays and about turns characterised the last years of the Labour government up to 2009 and much of the five years of the Coalition period when power was shared by the Conservatives with the greener LiberalDemocrats.
15 anti-green policies announced since the Tories came to power
Here’s a list of the 15 anti-green policies announced since the Tories came to power:
- it has scrapped Renewables Obligation subsidies for new onshore wind farms and larger solar farms from next year
- it has launched a tax raid on renewable operators by extending the Climate Change Levy, intended to be a tax on fossil-fuel generators to include renewables, which will result in a substantial amount of lost income for clean energy companies. For example, Levy Exemption Certificates account for just over six per cent of onshore wind generators’ revenues
- it has tightened planning rules for the onshore wind energy sector and hinted that onshore wind farms will not be eligible to participate in any auction for price support contracts
- it has postponed to an unspecified date the next contract for difference (CfD) auctions for large renewables projects, leading to speculation it will not be undertaken this autumn as planned
- it has scrapped a policy that by 2016 every new home should be zero carbon, which has been in place for eight years and which the industry has been preparing for on the (debatable) grounds of affordability
- it has axed the domestic energy efficiency programme, the Green Deal, following disappointing take-up rates due to the fact that the interest rate at the start for borrowing finance was set way too high, at eight per cent (in Germany a similar, successful, scheme has an interest of late of just over two per cent)
- it is ending subsidies for small solar farms from next April under a consultation that will affect those with a capacity below 5MW accessing the Renewables Obligation (RO)
- it is cutting support for smaller renewable energy installations, ending a pre-accreditation process under which solar PV and wind projects above 50kW and all hydro and anaerobic digestion (AD) projects may confirm the level of support they can secure through the scheme once they have planning permission and a grid connection. This will particularly affect corporate and community renewables projects
- it is to sell off up to 70 per cent of the Green Investment Bank, launched in 2012 with £3.8 billion of public sector money and designed to profit from investment in new green infrastructure. The move was attacked by Tory Ben Goldsmith, chairman of the Conservative Environment Network, which numbers prominent Tory supporters and MPs among its members, who called it “one of the Coalition government’s few great, green achievements”
- it has reduced the incentive to buy a low-emissions car, charging the dirtiest and the cleanest the same rate of vehicle excise duty from 2017 in an effort to raise more tax revenue
- it is announcing plans to fast-track planning applications for fracking when local people and local authority planning departments decide against a scheme, even in sites of special scientific interest and national parks. Recently Lancashire Council rejected two planning applications from shale gas developer Cuadrilla
- it has scrapped a target set by the coalition government to keep increasing the proportion of revenue from environmental taxes
- it has removed the guaranteed level of Renewable Obligation subsidy for coal or other fossil fuelled-power stations if they wish to convert to burning biomass fuels
- there has been no funding for solid wall insulation since 26th March 2015
- it is to continue with support for nuclear power with an announcement expected this week on Hinkley Point C
The new energy secretary, Amber Rudd, has said her priority is to keep bills as low as possible while reducing emissions in the most cost-effective way. But the changes seem to many to be ideologically motivated, as they do not stand up to evaluation under their own criteria.
As a result of all these moves it is now possible that the UK will not meet its target for renewable energy for 2020. Rudd is on record as saying that ministers believe this doesn’t matter as long as the UK meets its carbon emissions targets.
Solar PV has been the most popular renewable energy technology in the UK since the feed-in tariffs came in five years ago but growth has now stalled. It may be that the solar industry can survive without subsidies since costs have fallen by two thirds and are set to fall by a further 35 per cent by 2020.
In 2014, the last year for which figures are available, renewable electricity’s share of generation increased from 14.8 per cent in 2013 to a new record of 19.1 per cent in 2014, as a result of increased capacity. Low carbon electricity’s share of generation increased from 35 per cent to a record 39 per cent, due to increased renewables generation. Nuclear generation decreased by 9.7 per cent, due to a number of outages in the second half of the year.
However, renewable energy, which includes heat, only provided 14.2 per cent of total energy in the same year. The 2020 target is 15 per cent.
In the same year 394 tonnes of carbon dioxide per gigawatt-hour were emitted accounting for 30 per cent of the UK’s total carbon dioxide emissions. The UK has an “interim target”, of a 34 per cent cut by 2020 compared to 1990, which was made legally binding in the April 2009 Budget, under the Climate Change Act 2008. The European Union target is 20 per cent by 2020.
The Committee on Climate Change (CCC) has repeatedly recommended an intensity target for the electricity sector of 50-100g CO2e/kWh by 2030. In 2013, the average carbon intensity of the UK grid was 497g CO2e/kWh.
If the Conservatives want value for money, it is ironic that they are attacking onshore wind power, which is the cheapest form of renewable electricity.
If the Conservatives want to bring consumers’ fuel bills down, particularly for the fuel poor, then they should replace the Green Deal with something else, but they have not yet done so. Over the last five years the number of homes being insulated and made more energy-efficient has plummeted. For instance the number of cavity wall insulation is has fallen from a peak of just under 600,000 in 2009 to just under half that in 2014.
Meanwhile, the Energy Company Obligation (ECO) scheme will continue until March 2017 and the government is working with industry and consumer groups on what it calls a new “value-for-money approach”.
The number of people living in fuel poverty has increased to 2.3 million households in England. Improving energy efficiency of housing is the most cost-effective way of tackling the problem and reducing bills and emissions, yet it has been undervalued for the last five years.
Nuclear power: Yes please
The British Government is expected to make an announcement this week about the future of Hinkley Point C, which would be the first new nuclear power station in the UK for decades and be built by French company EDF. David Cameron is expected to sign a final deal in October during Chinese president Xi Jinping’s visit to the UK. The Chinese are underwriting much of the cost.
EDF’s potential partners in Hinkley Point are China General Nuclear Power Corp, China National Nuclear Corp, France’s Areva, Saudi Electric and several pension funds.
This 3200MW plant could only happen with a massive £17.6 billion public subsidy and will cost in total a whopping £24.5 billion. This project was begun under the Blair government and has taken many years to negotiate. In November 2011 the government negotiated a strike price for its output, guaranteed at £92.50 per megawatt hour (double the market rate), inflation-linked for 35 years and funded through household bills.
When complete, possibly within 10 years, it will provide seven per cent of the UK’s electricity demand. But HSBC’s analysts have described the technology to be used, EDF’s European Pressurised Reactor (EPR), as “too big, too costly and still unproven”.
The reason given for the above cancellation of green subsidies was to reduce consumers’ energy bills. Subsidies paid for by increases in energy bills disproportionately affect the poor. Yet this deal is likely to substantially increase them for many years to come.
EDF’s supporters say that nuclear power, unlike most renewables, supplies baseload demand and improves energy security, reducing the need for imports.
“Nuclear power is still the choice that gives reliable baseload power at the same time as helping Britain meet its carbon emissions targets. When the cost of extra back-up needed for intermittent renewables is included, the cost of nuclear remains competitive with any other technology,” EDF says.
The Minister closes with an assertion that the 2°C goal remains an imperative for her government. Yet her own policies are premised on the UK’s receiving a hugely inequitable share of the global 2°C carbon budget, alongside the large-scale uptake of highly speculative negative emission technologies sometime in the far distant future.
But Peter Atherton, energy analyst at investment bank Jefferies, has told the Guardian that, for the same price as Hinkley Point C, almost 50,000MW of gas-fired power capacity could be built, that’s 15 times as much power.
A European Commission investigation into the deal originally expressed scepticism that it would provide value for money, and said it could distort the market for energy across Europe, but it was eventually given approval for reasons that have not been made public. This decision is yet to be challenged by Austria, which could still mean the plant does not go ahead.
So where does this leave Britain’s position on climate change? Amber Rudd has said she is still committed to getting a good deal in Paris in December for reducing global carbon emissions, but she will find her negotiating position severely weakened by her government’s anti-green action.