This morning I announced the results of the first auction for green energy generation. The results are impressive – more clean energy at lower costs.
Thanks to this first renewable electricity competition of its kind, I have offered contracts to 27 renewable energy projects across the UK. Enough to power 1.4 million homes and save the equivalent carbon emissions of taking 2 million cars off the road.
The projects include offshore wind and onshore wind and solar, and will create thousands of green jobs.
What’s even better are the lower prices our green competition achieved. The first ‘reverse auction’ ensured that prices were driven down. This meant we got more green energy from our budget than expected.
By bringing this auction forward by two years than planned just 3 years ago, we’ve saved £110 million a year.
And this latest boost to the UK’s green electricity revolution builds on our strong record of delivery since 2010. It’s important you have the facts as there is so much misrepresentation of our progress by Labour. Here are some facts to remember:
– Electricity generation from renewables has more than doubled since 2010.
– Since 2010, an average £7 billion a year has been invested in renewables. Compare this to £3 billion a year in the previous parliament under Labour.
– In 2013, almost £8 billion was invested in renewables – a record – though provisional figures suggest 2014 will be even better!
– Britain’s first Green Investment Bank and first Community Energy Strategy.
– Britain (Lib Dems!) in Europe leading to win more ambitious greenhouse gas reduction targets for 2030 to give even more confidence to the industry and investors.
If that’s not enough then just last week I gave development consent for what will be the world’s largest offshore wind farm and today I’m opening England’s largest onshore wind farm.
This is a story of success by any measure. But we cannot be complacent and simply assume what Lib Dems in government have achieved on green energy will simply continue unchallenged. Under Labour their heavy hand of regulation will see investors press the pause button on UK plc – because they are not obliged to invest here. They will go where they see certainty, the sort of certainty that we have created.
As for the Conservatives, they continue to try to talk a good game on renewables, but their credibility is thin and their arguments fall apart when you look at the real world. Tories say they want to see renewables delivered in the cheapest way and I’m 100% with them on that. The trouble is if you look at what this reverse auction has delivered on prices then onshore wind and solar are clearly offering cheap green energy. As the Conservatives want to cap onshore wind, and they are not exactly promoting solar, you have to ask how they’ll plug their ‘renewables gap’ if they want to meet our legal obligations to tackle climate change and ensure consumer bills don’t go up. You can only see one scenario for Conservative energy policy – plugging the carbon gap with more expensive forms of green energy. Energy bills up under the Conservatives!
Lib Dems in government have delivered on green energy in a way that’s affordable to consumers. Yet the five green laws I proposed for the front page of our manifesto show we don’t believe the job is yet done. We want to go further and faster over the next five years. Nationally and globally our environmental challenges haven’t gone away.
* Ed Davey is the MP for Kingston & Surbiton and Leader of the Liberal Democrats
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21 Comments
Note that a “home” in renewable energy speak is 0.5 kW, so this is 700 MW. Roughly equivalent to one combined cycle gas turbine station.
I find the idea of “UK plc”. having to attract footloose global capital doesn’t sit we’ll with me. I’d like to think that we are a community, not a commercial company. Why don’t we invest our own money?
“Why don’t we invest our own money?”
Put very simply, we don’t have any spare, because money raised through taxation isn’t sufficient to cover current spending, let alone all our capital investment needs.
Also, there is a deep set ideological bias against the state taking on projects of this kind, which is something we Liberal Democrats should be challenging, but sadly we are not, despite past evidence that the state is a better vehicle for major infrastructure investments with very long term returns.
While we have achieved some major wins in terms of green energy, our policy in terms of domestic energy efficiency seems to have been an epic fail. Unless I am being too harsh.
RC
You are not being too harsh.
Despite all the exaggerated language in the original article – the last 5 years reveals a timid and less than impressive record.
Domestic energy efficiency improvements have moved at a snail’s pace.
Renewables started at such a low base that even these small improvements can be made to sound large, but people are not stupid and they are not convinced by over-hyped language about how wonderful everything is.
A more rational, objective and calm analysis of the situation would win respect.
Telling people that after 5 years of Conservative Coalition everything is marvellous is an own goal.
DECC’s insane policies have spawned an entire industry to plunder the public purse mercilessly while destroying energy security and creating fuel poverty for the most vulnerable in our society. This is shocking incompetence on a breath taking scale.
Around three years ago I calculated from a selection of contemporary press reports that a “home” was generally about 1.5 kW but sometimes as low as 1.25 kW. Of course a “home” is not a recognised SI unit so it’s difficult to be sure but it does seem to suffer from extreme “boast inflation” so a much lower figure now is entirely possible.
“Why don’t we invest our own money”?
Why not indeed? To argue, as the Conservatives do, that we don’t have any is to fundamentally misrepresent the situation either because of bad economics or because it provides a handy justification for desired policies like cuts in public spending and privatisation.
There was plenty of money to bail out the banks – £375bn in QE alone not counting the cost to savers of suppressed rates etc. As RC says in infrastructure there is a very good case for the state to take the lead on purely financial grounds (not to mention that so much infrastructure is a natural monopoly). In general the cost of outputs from infrastructure (electricity in this case) are very sensitive to the cost of finance; government has the lowest financial costs – almost zero at present – so it could deliver much cheaper electricity (or whatever) if it wished – and if it wasn’t in thrall to a version of economics whose main objective is to justify Conservative policy objectives.
Former Japanese PM Naoto Kan is concerned about the path we are going down with respect to nuclear energy.
http://www.walesonline.co.uk/news/wales-news/japans-former-prime-minister-warn-8713266
GF 26th Feb ’15 – 6:19pm
“There was plenty of money to bail out the banks – £375bn in QE alone not counting the cost to savers of suppressed rates etc.”
Absolutely – and most of it has actually found its way into the pockets of the Super Rich. It is not especially a topic for this thread but it highlights much of what is wrong with the society and values the seriously rich and powerful have conned ordinary people globally into – and, to add insult to injury, frequently involving use of terms such as liberalisation, neo-liberal, free market etc. No! It’s day light robbery.
‘Common Ground’ opening anyone?
Peter 26th Feb ’15 – 5:46pm
Peter – may I ask you a few questions?
Are you really interested in “the most vulnerable in our society”?
Do you believe in climate change or are you a sceptic?
Lets just say that man-made climate change was universally accepted – then how would you start to reduce the levels of CO2 in the atmosphere?
Would you say that Britain should take a lead or insist that everyone else to act first?
Tsar Nicholas 26th Feb ’15 – 6:52pm
“Former Japanese PM Naoto Kan is concerned about the path we are going down with respect to nuclear energy.”
Some are willing to accept the fallibility of human beings and our technology. Some are willing to learn the lessons of history. Some follow the precautionary principle.
Some, like Naoto Kan, end up having to learn the hard way. It is an incredibly expensive lesson. A price ‘Peter’ might wish to consider in his ‘costings’.
Ed Davey’s work is a real asset to the Lib Dems and we need to stop under-selling it. Auctions for energy contracts are a good counter to the argument that green energy is always expensive.
We also need to be careful. There seems to be a push by consumer groups to say “cheap good, expensive bad” and that doesn’t work because the quality of the provider matters too. We see this in finance and law too.
Regards
Jenny Barnes 26th Feb ’15 – 1:26pm
“I find the idea of “UK plc”. having to attract footloose global capital doesn’t sit we’ll with me. I’d like to think that we are a community, not a commercial company. ”
Spoken as a true Liberal Democrat. It is a term that has been around many years now and its use never fails ‘not to sit well’ with me either. But there again, as pointed out by Vince Cable, share holders have precious little power over PLCs either.
UK PLC as a description is also more than a little out of date! The problem often is, within the CURRENT structure of globalism, is that the powerful private economic entities (transnationals etc) are at global level, and most of the community and democratic entities are at national and local level. I don’t have to remind anyone of the massive imbalance that causes!
GF: This is a quote from the BBC news site: http://www.bbc.co.uk/news/uk-scotland-highlands-islands-31622938
“A major offshore wind farm planned for the Firth of Forth is one of 11 Scottish renewable projects which have been awarded UK government contracts to supply electricity.
The 448 megawatt Neart na Gaoithe could generate power for 319,000 properties.”
Now, wind power is generally taken to be equivalent to 1/3 of the rated output, because of intermittency, so this is equivalent to 149 MW available – call it 150 MW for 300, 000 “homes”. That’s 0.5 kw per “home”.
“Boast inflation” – nice one.
Stephen. Tim, thanks. It seems that capital has been allowed to escape regulation by going global, while the state, consumers and workers are restricted to particular countries. Imagine the horror of a regulation established more widely, for example across the EU! Oh.
Stephen Hesketh – You asked about my concern for vulnerable people.
Mr Davey is throwing large sums of money at solar and wind power providers, far more than the cost of conventional power per unit. These contracts did not even involve competitive tenders and in many cases milk the consumer regardless of whether or not the generator is producing electricity.
Those rich enough to cover their lands and properties with solar panels or turbines are on a very lucrative deal indeed. Those who own neither land or the roof over their heads have to pay large levies on their bills to keep the rich on the energy gravy train.
This madness is aggravated by the unreliable, inefficient nature of solar and wind generation which requires conventional power stations to be on standby, running inefficiently at high cost and higher than normal CO2 emissions. Even then, the lights may still go out, so Mr Davey is paying lucrative standby rates to more land owners to fill their fields and warehouses with polluting diesel generators. Should this not be enough, he has agreed to pay industry to stop production.
The consumer is paying for all of this madness which fills the pockets of the rich. The poorest consumers may not afford the increased fuel bills. The net savings in CO2 are negligible. The Secretary of State is failing in his duty to provide reliable, efficient, secure and low cost energy to the country.
You ask if I am really interested in the poor in our society. I hope I have answered your question. I cannot comprehend the many comments on this post which applaud Mr Davey for his achievements in this matter. Clearly, there are many here who have no interest in the poor, who are the clear losers in Mr Davey’s plans.
Thanks for the comments.
Our record over the past 5 years on attracting renewable investment and boosting energy efficiency in the UK is one of which all Liberal Democrats should be very proud. The facts speak for themselves.
We have had the largest investment in renewable electricity in each of the last three years (Source Bloomberg New Energy Finance) of any country in the EU – yes, larger than the renewables sector in the much larger economy of Germany! As a result of our encouragement of investment in the renewable industry we are now getting the dramatic reductions in costs for consumers that these auction results have revealed.
On energy efficiency official statistics released by my department this week show that our primary energy consumption last year fell by 5.6% ( after adjusting for temperature and GDP growth to ensure a like for like comparison). That is a quite remarkable improvement in energy efficiency in just a single year building on the steady progress we have made over previous years and shows how our energy efficiency policies are really working.
But of course we have much more work to do. That is why two of our Five Green Laws will be a Zero Carbon Britain Bill and a Green Homes Bill focussing on energy efficiency and renewable heating of our homes.
A record of delivery, a promise of more
No doubt Mr Davey and many party members regard themselves as true environmentalists.
But picture 400 feet high structures, each consisting of 1000 tons of steel and concrete – now picture at the bottom of each one a wooden crate 5 feet x 3 feet x 2 feet, containing an industrial electric motor, weighing under 2 tons.
For the whole of 2014, on average, each of the UK’s 5,635 wind turbines was only capable of powering that single electric motor.
Can any true environmentalist among you justify this obscene imbalance in the use of precious resources, combined with the destruction of pristine countryside, ecosystems and wildlife?
Just do a search for – “plonk 1000 tons”
Stephen Hesketh – You ask if I am a sceptic. I do not see science as a subject for consensus, faith, political, emotional or environmental based belief.
I try to assess climate science as objectively as possible by examining the evidence.
This leads me to accept the greenhouse warming effect though it is still subject to unproven assumptions and considerable uncertainty.
The climate sensitivity to the greenhouse warming is being revised downwards all the time and the positive feedbacks that drive much of the warming predictions of climate models are showing no supportive evidence.
Increasing influence is being attributed to natural climate variability.
There is evidence that extreme weather events are decreasing globally, not increasing.
All of this implies that the more alarmist view of global warming is not supported by observation or any other convincing objective evidence. Moderate warming will take place, but adaptive strategies will probably suffice.
This assessment is subject to change as more information becomes available.
I agree with Ed Liberal Democrats must champion renewable energy systems not just for domestic fuel consuption but also for our high carbon usage industrial manufacturing sector .Who are keen to switch from coal ,gas ,and other fossil fuels .
Its not all wind turbines and nuclear .There is also Anarobic Digestion ,Hydro piower ,Ground Source Heat Pumps ect . Even Margeret Thatcher realised that we could nt be reliant on one or two sources of energy production. Her mistake was to move to large scale coal imports when the rest of Europe was diversifying .So well done Ed but dont stop with the present .Championing a wider range of generation to ensure energy security for future generations must be a top priority for Liberal Democrats.
Neil Sandison 28th Feb ’15 – 1:03pm
Neil, I agree it is not all wind turbines and nuclear. We really should be implementing more ‘energy from packaging waste’ generation. We all need to look at what actually goes in the bin and off to expensive land fill these days. We are paying to bury a valuable resource that could be burnt as an end of life energy recovery exercise and as a cleaner alternative to coal. I agree it generates CO2 but it remains a less wasteful route than burying it in ever more expensive land fill and burning mainly imported gas instead.
Stephen Hesketh
Glad you agree unfortunately point about land fill is a bit out of date in Warwickshire they have diverted mixed waste from land fill into 100% incineration .despite the fact that they agree 40% of the mixed waste is in fact recyclable and recoverable .We have been argueing since the RSS that they should optimise recovery of recycling materials in
the waste stream and then converting the residue into a man made low carbon for manufacturing fuel which is being done elsewhere .The income raised could then be plowed back into hard stretched public services like social care .
Ed Davey was on the Today Programme on BBC Radio 4 on 17/11/2015 talking about different types of wood being usable for the replacement of coal in existing power stations and stating that what the current Conservative government is doing is illegal. These arguments usually require numerate answers. He did not say anything about tidal power, which his predecessor considered (but of course prices change over time, substantially in energy). He did not add to what he had previously said about North African solar energy and the potential for more interconnectors, which he had previously said, required political co-operation from France.