“My priority is to ensure energy bills for hardworking families and businesses are kept as low as possible,” said energy and climate change secretary Amber Rudd, announcing sweeping cuts to renewable energy subsidies on Thursday.
Yet this rationale crumbles to dust under the slightest scrutiny. The nations’s most popular energy technology, solar power, adds just a few pounds a year to energy bills. The best cost-saving measure – energy efficiency – has had its support slashed by Rudd and the Conservative party has forgone the cheapest of all low-carbon energy, onshore wind.
Coming just five days after a global agreement on climate change was signed in Paris, which Rudd attended and said was ”vital for our long-term economic and global security”, the government was under heavy pressure to row back on its proposed 87% cut to subsidies for solar panels on homes.
It did, reducing the cut to 65%. But it has also imposed a cap on the total subsidy paid out, meaning the rate of domestic solar installations is set to halve, according to the Solar Trade Association. Larger solar installations (more than 1MW) on roofs and in solar parks have had their support cut by 85% and 71% respectively, meaning the market for the most cost-effective projects is all but dead.
All this while the global solar market soars and while the UK solar industry had already said it wanted to be off subsidies by 2020. These cuts are snatching defeat from the jaws of victory. It makes a mockery of prime minister David Cameron’s speech to the Paris climate summit: “Instead of making excuses tomorrow to our children and grandchildren, we should be taking action against climate change today.”
Rudd said on Thursday: “We have to get the balance right and I am clear that subsidies should be temporary, not part of a permanent business model. When the cost of technologies come down, so should the consumer-funded support.”
Yet this only applies to renewable energy. Nuclear power, whose cost never comes down, will enjoy 35 years of bill payer subsidies to support Hinkley Point, the most expensive power station ever built.
Fossil fuels enjoy £27bn a year in subsidies in the UK, according to the IMF, £425 for every man, woman and child in the country. Are these coming down? No, the UK is the only G7 nation increasing fossil fuel subsidies.
What about carbon capture and storage (CCS), the technology deemed vital to tackling global warming by the UN’s Intergovernmental Panel on Climate Change? The UK government’s own advisers, the Committee on Climate Change, warn that without CSS the costs of meeting carbon targets will double.
But at the last moment, the government reneged on its manifesto commitment and last month abandoned a £1bn competition for demonstration plants. Does that sound like “ensuring energy bills for hardworking families and businesses are kept as low as possible” or “taking action against climate change today”?
Action is certainly being taken on shale gas, with measures to allow fracking under protected areas pushed through on Wednesday. Rudd signalled a new dash for gas power stations just a month ago. Nick Mabey, from the thinktank E3G, summed this up pithily: “The government replaces domestic renewables and efficiency with imported gas, then proposes shale to solve the [energy] security problem. Mad.”
In May, Rudd said: “I want to unleash a new solar revolution – we have a million people living under roofs with solar panels and that number needs to increase.”
When the renewable energy industry has friends like Rudd, who needs enemies?
But enemies there are, principally George Osborne, the driving force behind the barrage of anti-green moves since May’s election.
Matthew Spencer, at the Green Alliance, has wise advice for the chancellor: “Unlike budget announcements, successful infrastructure policy can’t be made tactically; if Osborne does eventually become prime minister, he risks inheriting an energy policy mess he has created, and will find that the remaining policy levers in his hands don’t produce quick results … He’d better not leave it too late to get on the right side of the [climate] argument.”
This content was originally published here.