Government blinded by ideology when it comes to energy

In what can be interpreted as a highly symbolic act of rebellion against government policy, the Mayor of London, Boris Johnson expressed concerns about the impacts of the severe cut to the Feed in Tariff by 87 per cent, and ordered his officers to undertake an assessment of the deployment and jobs loss impacts on London.  Boris added “it would be wrong if the cut in the Feed in Tariff actually stops people from investing in solar, because clearly it has many attractions”.  

Well, the repercussions are already being felt, and are clearly set out in the proposal’s accompanying ‘impact assessment’. They expect reductions in solar deployment, and even more ‘pronounced’ impacts for the community energy sector that is already reeling from the Government’s axing of the renewables feed-in tariff pre-accreditation.  To emphasise this point, I invited the Mayor to join me on a visit to a school in Croydon that as a direct result of the changes threatened from January 2016, has pulled out of a planned large solar panel installation. And since I quizzed Boris at Mayor’s Question Time on the 16th September, a solar company based in west London informed me that £2.5m worth of contacts to install solar PV systems with two household names have been placed on hold. 

These are worrying signs, particularly as London has about 10,000 jobs in solar PV and the impact of this subsidy cut, and the axing of other important green initiatives on one of the fastest growing sectors of the economy is idiotic and self-defeating. 

At this meeting, the Mayor pondered over the reason for the government’s decision to cut back subsidies and thought it had something to do with solar panels getting cheaper. However, if indeed as he claims he is ‘talking to members of all the representative bodies of solar industry in London’ he would be left in no doubt that this is not the critical factor. With the exception of a few key figures in the government, it has been the government’s longstanding intention to kill off the ‘green crap’ (also known as ‘green taxes’) in order to clear a path for nuclear and fracked oil and gas, and maintain the interests of the fossil fuel giants. And since coming to power, they have carried out a vicious and systematic attack on renewables and energy efficiency programmes.

Overseeing what has been described as the worst period for environmental policy in three decades, the secretary of state for energy and climate change Amber Rudd argued that it’s all about keeping bills as low as possible for ‘hard working families and businesses’.  While this argument may succeed in conning some of the people some of the time, it needs to be considered in the context of how much hard working families and businesses are paying in subsidies to the fossil fuels and nuclear industry and the costs of not tackling global warming. 

In 2014 renewable subsidies were responsible for £45 (£36 ROCs and £9 Feed in Tariff) of the £1,369 average household dual fuel bill per annum. And whilst the government was playing politics by blaming big supplier price hikes on green taxes, the £650 average increase in fuel bills over a ten year period to 2013 was associated with rising costs of wholesale energy and system costs and unrelated to low carbon policy. 

And whilst the government is happy to make a meal out of relatively modest subsidies for energy renewables, they are not so upfront when it comes to subsidies for fossil fuels, which amount to about £400 for each person in the UK each year.

Or the blank cheque that is offered to the nuclear industry. The latest estimate for the proposed Hinckley point nuclear power plant is of the order of £17 billion from public subsidies. Extremely poor value for money and gross hypocrisy.  And let’s not forget how much nuclear decommissioning costs the taxpayer, almost £7.9 billion in 2013/14.

There’s also the arbitrary and immovable cap in the form of the Treasury’s perverse Levy Control Framework mechanism, the major barrier used by the government. It needs to be either reformed to enable the rapid growth in solar and other renewables, or replaced with some other mechanism where significant subsidies out of direct taxation are diverted away from fossil fuels, nuclear and fracking and channelled into renewables.  

And then there is the government’s determination to ‘deliver shale’ at any cost. And while public support for solar is at an all-time high, the support for shale gas is at an all-time new low. However, this has not put the government off. Their frustration boiled over recently, when they introduced changes to deprive councils of sufficient time to properly consider environmental implications and local objections. And failing to make a decision within 16 week period, gives the secretary for communities the power to ‘call in’ applications to decide himself. 

It is really tragic that when so many people and organisations want to be part of the green economy, and for renewables to play a major role in our energy mix, the government is so blinded by ideology and maintaining the interests of the fossil fuel, nuclear and fracking industries they cannot, or chose not to see the growing evidence that we are heading for a climate change catastrophe and the window of opportunity for decarbonising and switching to a low carbon economy is rapidly closing.