Only one cheer for the draft Energy Bill

The Energy Bill was a golden chance to meet Britain’s energy needs; however, the coalition’s approach only deserves one cheer, not three.

Bad air: A chimney belches out fumes

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Will Straw is the Associate Director for Globalisation and Climate Change at the Institute for Public Policy Research (IPPR)

A cast list of senior figures in the energy world will provide evidence today to parliament’s energy and climate change committee.

Representatives from environmental NGOs like Friends of the Earth, Green Alliance and WWF; business groups including the CBI, Renewable UK and Low Carbon Finance Group; and experts from various universities and the government advisors at the Committee on Climate Change (CCC) will have their say on the government’s draft Energy Bill. The consensus is likely to be negative.

Chimney-belching-out-fumesAs IPPR’s own submission to the committee makes clear, the package of measures is likely to fail against energy and climate change secretary Ed Davey’s own claims it will “keep the lights on, bills down and the air clean”.

No government is going to let a blackout happen but the Bill and other parts of the Electricity Market Reform will miss the mark on both cost and carbon reduction.

The government’s approach to securing supply is based on replacing dirty coal with nuclear and renewables in the long run while ramping up gas in the interim. But the Energy Bill is perplexing potential investors with uncertainty about the size and administration of incentives for green generation.

Even if this is resolved, the private sector looks unlikely to deliver the government’s ambition of 18 gigawatts of new nuclear capacity. Without an adequate focus on renewables, the result will be an increase in reliance on imported gas.


See also:

The Energy Bill should have included clauses to protect consumers 22 May 2012

Budget 2012: The fossil fuel friendly Mr Osborne 27 Mar 2012

We need more community and co-operative ownership of energy 13 Mar 2012


Late last year, the CCC found that close to two-thirds of the increase in energy bills since 2004 had been due to the wholesale price of gas. Despite the media hullabaloo about the costs of renewable energy, just 16 per cent of the rise was due to green measures such as those to support low carbon power or fund energy efficiency improvements. If we want to keep costs down in the long run, we need more renewables and less gas in the long run.

While the potential of the Energy Bill to increase consumer costs will dominate media coverage, a more serious long-term consequence is the Bill’s failure to adequately deal with the need to reduce carbon emissions.

The 2008 Climate Change Act, which was passed with near consensus, bound future governments to reduce greenhouse gas emissions against 1990 levels by at least 34 per cent by 2020 and 80 per cent by 2050. The CCC has judged that meeting the 2050 emissions reduction target “will only be achievable if electricity generation is almost completely decarbonised by 2030”.

But to allow for this ‘dash for gas’, the small print of the Energy Bill suggests this ambition will slip and only be reached “by the 2030s”.

The intensity of carbon emissions as a result of these reforms is likely to be double what is needed. The CCC has stated the carbon intensity of power “will need to fall from around 500g/kWh today to 50g/kWh in 2030” – but the impact assessment for one section of the Bill outlines carbon emissions’ intensity from the power sector will actually be 100gCO2/kWh in 2030.

The Energy Bill was a golden chance to meet Britain’s energy needs, keep prices competitive, and lead the way on tackling climate change. The coalition’s approach only deserves one cheer, not three.


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  • Lord Blagger

    Despite the media hullabaloo about the costs of renewable energy, just 16 per cent of the rise was due to green measures such as those to support low carbon power or fund energy efficiency improvements. If we want to keep costs down in the long run, we need more renewables and less gas in the long run.


    Spin spin and more spin.

    Compare the cost of gas against the cost of wind. Make sure you include the gas plants that you need to cover for the common situation when the wind doesn’t blow and you get no electricity, as well as the situations where the wind blows too hard, and you get no electricity.

    Then add on the real cost. Government and taxes.

    Government and renewables are the major cause of fuel poverty in the UK .

  • Lord Blagger

    Now on climate change. We look back at the predictions made by Hansen. After all the scientific method is clear.

    Theory, predict, test. If the test succeeds you have evidence that the theory is correct. If however, it fails, then its bunkum.

    Nice graph. Prediction compared to reality.

    Theory is disproved.

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  • Blarg1987

    As in goverments fault for privatisation?

    The UK has left its investment in the next generation of energy very late, hence the large rush to invest into renewables etc, if it was done over a longer period at a slower rate then the effects would not be as bad.

    Add to that the idea that most of our enegery is being imported now from Russia and the Middle East, if we go down the road you advocate then that would lead to even higher energy costs and greater fuel pverty down the line as these countries demand more money for the ebergy they sell.

    It is better to try and reduce the risk granted it wont be eliminated but at least it should cushion any potential future spike in energy prices for people.

  • Anonymous

    That’s right, and if you were linking to a credible scientific paper rather than a blog of who has been repeatedly lambasted for sloppy work, you might even have a point.

    Keep up the anti-science agenda.

  • Anonymous

    It won’t “cushion” anything, it’ll cause a constantly rising elevator of energy prices to pay for the FIT’s, which don’t go away when you’ve built the plant. We need to be building nuclear plants /today/. 36-48 months to cover, which is doable.

    We DON’T need the insane scheme of building non-economic wind plants to cover “renewable obligations”. While LFF might chose to look at the huge lump of costs inflicted on poorer people as “small”, every penny counts.

    Oh and Blagger? 80% of the cost of gas-fired plants is the fuel. 10% for nuclear.

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  • Ecosolglobal

    Whatever Bill they pass in the congress to the senate, they should think of who benefits. If they think of the corporate side then there’s no use in trusting them. If possible, they consider the general public, then that would not only be a good move but a miracle.

    Lessen Harmful Emissions