Another Day, Another Blunder: New Subsidies To Renewables Are A Costly Mistake
London, 3 March: The Global Warming Policy Forum (GWPF) has warned Boris Johnson that his government’s plan to increase the multi-billion renewables subsidy burden for households and businesses is a risk to Britain’s post-Brexit economic plans.
Subsidies to renewable electricity generators such as wind and solar currently amount to nearly £10 billion a year, a cost that is still rising and on current estimates will extend well into the future.
However, rather than aiming to reduce this burden, government yesterday bizarrely announced that it would be re-opening the Contracts for Difference (CfD) subsidy scheme to onshore wind and solar energy as part of its drive to achieve Net Zero emissions.
In fact only a limited quantity of additional annual subsidy remains in the current CfD scheme, but this is a clear first step towards the wholesale resumption of subsidy in the near future.
This, however, would only be possible if the Treasury caves to the pressure by green activists and the renewable energy lobby who demand a lift of the Treasury’s current ban on new subsidy instruments.
Incredibly, the government’s own Impact Assessment contains no estimate of the cost to the consumer, because they have no reliable evidence of what level of subsidy would actually be required.
Flying blind is not responsible government.
Industry watchers, including GWPF, are deeply suspicious of claims that the renewables industry no longer needs subsidy, since there is clear evidence that capital and maintenance costs remain extremely high in the sector, in spite of decades of public support.
The proposed renewal of subsidies for renewable energy projects proves once again that wind and solar energy remain uncompetitive without government support,” said GWPF director Benny Peiser.
The British public has spent tens of billions subsidising renewable energy, and it still needs the artificial life support of non-market prices and contracts. This will almost certainly cause energy prices to rise even more, risking a public backlash.
If Boris Johnson doesn’t wake up to the danger of renewables-based climate policy he can kiss goodbye to a post-Brexit prosperity,” Dr Peiser added.