It’s the energy policy issue of the decade. Power bills have risen and renewables have expanded, so the link is obvious to the likes of Reform UK. But Energy Secretary Edward Miliband says the only way to cut bills is to push green technology. Well they do cost, but he says less overall than fossil fuel. As he noted, generation costs have already fallen ‘Strike prices for solar and onshore wind in our last auction, AR6, were nearly 50% cheaper than the levelised cost estimate to build and operate a new gas plant. Offshore wind, despite global cost pressures, was also cheaper than new gas.’ He admitted that there were other options but said ‘we won’t buy at any price and if specific technologies aren’t competitive, we will look elsewhere’.
Well that’s not what seems to have happened with nuclear, judging by the rising cost of Hinkley and the total nuclear spend, with Jonathon Porritt claiming that the Energy Department spent 60% its £8.6bn 2024-25 budget on nuclear support. And consumers are now starting to pay, in advance of the start of construction, for Sizewell C EPR, via the RAB private investor risk-reduction scheme.
Meanwhile the Renewable Obligation, which has supported most renewables so far, is due to end soon, with the competitive market-based CfD system taking over, providing lower levels of support as the technology matures. But will the next CfD round in January deliver 8GW with lower strike prices as hoped? Or will green targets be missed or lowered to cut costs? We shall see. But in an increasingly contrarian political and economic context, with cutting energy costs seen as paramount, rightly or wrongly, it may be that renewables and the Net Zero policy will face growing opposition from the likes of Reform.
It all sounds a bit tragic when you consider the likely impact of climate change and the scale of continued support for fossil fuels - Global Justice says the UK provides around £17bn pa. in subsidies for them. That’s nearly twice as much over the past five years than has been paid for the UK Renewable Obligation, CfD and Feed Tariff green power subsidy systems combined. Reform and the Tories of course want to do away with the green subsides and the Net Zero policy. The Tony Bair Institute also seems to have some similar ideas- go for gas!
However, a Yougov public opinion poll for FoE found that 80% of those asked backed support for renewables- including nearly 65% of Reform supporters. And green Net Zero policies are it seems also popular with some industrial interests:79% of large UK businesses consider it to be a strategic priority. Trade unions and workers may also welcome the associated job creation aspects.
Building on that, the government plans to train and recruit 400,000 more workers for the clean energy sector by 2030. Plumbers, electricians & welders are among 31 priority jobs ‘particularly in demand’, with employment in renewables wind, solar (and also nuclear!) expected to double to 860,000 in 5 years, ministers have said. Five ‘technical excellence colleges’ will be set up offering clean energy skills training with £2.5m in funding going towards pilot schemes in Cheshire, Lincs, & Pembrokeshire. Oil & gas workers could also benefit from up to £20m from government conversion training in clean energy. Although it seems that the rate of new green job creation isn’t currently meeting the rate of job loss in North sea oil and gas. Clearly then there is a need to accelerate renewables and green technology generally, especially since, according to a recent survey, many school leavers also want green jobs.
Given the right support, with AI possibly helping, green energy certainly looks like it should create new jobs and also cut bills, with some consumers also being able to take direct action themselves, via local energy club schemes. The government may offer other price reduction paths in the upcoming budget, although not everyone is convinced it really will be possible to cut costs dramatically in the short term, or even longer term. Well we will have to wait and see. Some are certainly hopeful that renewables will turn out to be cheap, as the technology develops and the market builds. PV solar looks to be going that way. Wind maybe too. But it may not. Looking at it all broadly, you could say that, during the fossil extraction era, we have got used to having relatively cheap energy, but with fossil resources dwindling and climate issues become ever more serious, that may no longer be the case.
There are other views! Some look to nuclear, maybe even fusion, and /or to geoengineering and carbon removal/carbon capture, but it’s not clear if any of these options will be sustainable, or viable economically, indeed they seem likely to be less so than renewables. A deep green view might be that, although renewables will play a key role, we should avoid technical fixes and instead should get used to sustainable energy costing more- and to using it more carefully. Taken to the extreme, that may amount saying it’s mostly about how and what we consume and that ‘sustainability can only be delivered by people, not machines’- a suggestion made in the set-up blurb for one of the recent Sustainability Faultline workshops (Number 4) in Bath.
Will the newly emboldened Green Party take that line up? Certainly, it is now more radical, and concerned with redistributive social issues, but perhaps less now with climate? Hard to say exactly, but someone had better do something more soon on that, if only in terms of temporary emergency adaptation: the governments Advisory Committee on Climate Change adaptation subcommittee says ‘unfortunately, we have to advise that the UK should be prepared for climate change beyond the long-term temperature goal of the Paris Agreement. We continue to believe that the long-term temperature goal is achievable, but prudent risk management needs to consider a wider range of possible worse outcomes.’ However, responding to that just with quick fixes would no doubt cost us more long term that sorting out our energy supply/use system properly…. But with short-term consumer costs apparently being all that matter (nuclear aside!), and fossil gas still in the running, that may not be how things go. Although the latest government move does offer hope for what may be seen as a somewhat more viable approach- see my next post.
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