U.K. to Keep Green Energy Subsidies Amid Row Over Consumer Bills
The U.K.’s Energy Ministry reassured renewable generators that it will keep subsidies for low-carbon projects after Prime Minister David Cameron responded to a row over rising energy bills by ordering a review of green levies.
Incentives are “essential” for investment and won’t be changed, a Department of Energy and Climate Change spokesman said today by e-mail in reply to a letter from opposition Labour lawmaker Tom Greatrex asking which charges would be reviewed. Unaffected programs include renewables obligation certificates, contracts for difference and feed-in tariffs, according to DECC.
Energy and climate change policies add about 9 percent, or 112 pounds ($178), to current annual bills for gas and power, DECC says. Of that, renewables obligations to support wind and solar account for about 30 pounds of the yearly payments and premium feed-in tariffs for low-carbon power add 7 pounds.
Energy Minister Michael Fallon said Oct. 30 that all green levies would be studied, while junior minister Sandip Verma said large-scale renewables and feed-in tariffs wouldn’t be affected.
“Neither of these statements brings any clarity to the Prime Minister’s declaration to roll back ‘some’ green levies,” Greatrex said in the letter to Energy Secretary Ed Davey on Oct. 31. He sought clarity, given the “concern and confusion.”
The biggest contribution of the policies to average annual bills is 47 pounds from the Energy Company Obligation that means suppliers must offer efficiency measures to vulnerable families. Other levies include the Warm Home Discount and carbon taxes.
The government aims to curb bills and help households, the DECC spokesman said in reply to the letter, citing Cameron’s introduction of annual reviews of competition in the energy markets. Support available for low-carbon electricity will rise year-on-year to 7.6 billion pounds to 2020, he said.
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