The Telegraph is reporting this morning that a crucial announcement over the level of support different renewable technologies would receive under the Renewable Obligation (RO) scheme has been delayed due to an escalating rift amongst the Coalition Government.
Conservative and Lib Dem MPs have reportedly been at loggerheads over the level of subsidy offered to wind farms. The revolt is believed to be led by the Chancellor, George Osborne, who believes that subsidy rates for the technology are too generous and has pushed hard for a 25 percent reduction in subsidy as apposed to the Government review recommended 10 percent.
The paper suggests that the Climate Change Secretary, Ed Davey, had agreed to the proposed 25 percent cuts in principle. However, the Deputy Prime Minister, Nick Clegg, removed Liberal Democrat support yesterday causing the announcement to be delayed.
The move comes after over 100 Conservative MPs urged the Prime Minister to axe the level of support for wind. In an open letter, the Tory MPs blasted the level of taxpayer-funded subsidies afforded to “inefficient and intermittent” on-shore wind turbines during the current financially straightened times.
Currently the UK generates around 7TWh of its electricity from on-shore wind. Government believes that this technology could contribute up to around 13GW by 2020. However, in order to achieve that level of capacity, the on-shore wind industry must grow by 13 percent per annum.
A Conservative source explained to the Telegraph: “We are prepared to play this long. Energy policy is absolutely critical and the Chancellor was not happy with what was ultimately on the table.”
The disagreement over wind farm subsidies is the latest in a long line of Coalition disagreements. Just yesterday, David Cameron, the Prime Minister, reiterated his commitment to the Coalition, saying: “I just want to say I am even more committed to Coalition Government, to making this coalition government, today than I was in May 2010 when Nick Clegg and I formed this government. I believe it has real purpose, a real mission.”
It is reported that another deal is now being negotiated that will see a new gas strategy put in place to replace some wind capacity. The resulting negotiations will push back the announcement on ROC rates for other renewable technologies until 2017 to autumn.
