Going green will cost Scottish householders £170 a year
Offshore wind farms will have a major role in meeting targets. Photo: Christopher Furlong/Getty Images
HOUSEHOLDERS face a rise of more than £170 in annual electricity bills to cover the massive subsidies shelled out to power firms for shifting to green energy sources over the next decade, experts have claimed.
Leading economists attacked the “excessive” £15 billion UK-wide pay-outs and warned they would lead to growing public anger, during a conference on the economics of renewables organised by The Scotsman.
The cost of the subsidies would be split between domestic and business customers, with households likely to pick up about a third of the outlay, amounting to an extra £170 a year on their bills.
The Scottish Government is committed to generating enough power to meet all of Scotland’s electricity needs from renewable sources, such as wind farms, by 2020.
But energy minister Fergus Ewing told the conference yesterday Scotland’s power supplies would always come from a “balanced mix” of sources.
Dr John Constable, director of the Renewable Energy Foundation, said that subsidy levels for renewable energy would be about £8bn by 2020, with grid management costs of about £5bn a year before VAT.
“The total additional costs to the consumer of the policies for electricity alone would be about £15bn,” he warned. “This is 1 per cent of GDP – that’s not credible and it’s not sustainable. It’s an enormous barnacle on an economy that’s struggling to recover.
“This is not the right way to develop renewables. You don’t want to over-shelter the sector with protection at that level. We will not discover what renewables have to offer until we stop subsidising it like this.”
Dr Constable said renewables were being treated like “spoilt children” because of the subsidies available.
“We’re trying to meet arbitrary targets without due regard to costs and those costs are extremely high. There will be public disenchantment with it.”
Energy economist Professor Tony MacKay added that protectionism had created a “very distorted market” for onshore wind farms.
“The subsidies in existence for the onshore wind farms are far greater than they require to go ahead,” he said.
“We need to make some big changes in order to get a more sensible renewable energy strategy in Scotland.”
Professor George Yarrow, chairman of the Regulatory Policy Institute, said the current focus on replacing environmentally unfriendly power sources, including coal-fired power stations, with green technologies such as wind farms overlooked the impact on electricity bills.
“That’s likely to prove a very costly strategy and very highly regressive in terms of income distribution, with transfers from low income households going to, among others on a fairly large scale, landed interests,” he said.
But Mr Ewing said: “Scotland, under the SNP, will not, does not and cannot rely on renewable energy alone. It will be part of a mix – a balanced mix.”
The minister said some people might be under the impression that the Nationalists’ plan was for “all our lights to be kept on by renewables”.
He added: “Plainly this is absurd. It’s not true and it’s important for me to state that this is the case.”
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Comments
There are 16 comments to this article
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montgomery fry
Wednesday, December 14, 2011 at 10:33 PM£170 a year! FYI the war in Iraq, which was arguably about energy security cost more than $1 trillion, and the lives of 60,000 Iraqis and 4,500 US troops. As they say... do the maths.
Kinghob
Wednesday, December 14, 2011 at 09:51 PMNuclear energy is highly subsidised by our taxes, is dangerous and leaves a massive problem with nuclear waste disposal. Renewable energy is the way forward and that is particularly true for Scotland.
Alternative (High Octane) Fuel Head
Wednesday, December 14, 2011 at 06:17 PM#10: "Carbon trading is going to be a reality..." If you use idiotic, meaningless phrases like that, you cannot expect anyone to take you seriously. This is NOT about carbon. It is about generating power and securing a power supply infrastructure for future generations. either you are winding me up or you don't understand basic facts. 1) Windmills are of no use as a primary power supply source. 2) Climate change is a natural phenomenum and nothing we do is going to affect it. And at #6, I have yet to see any great detail about any of this rubbish. I've seen plenty of over-complicated, twisted and self-contradictory arguments. I've seen loads of propaganda and I've even had it suggested that those who do not accept all this drivel are insane. I suggest that you read a copy of Propaganda: The formation of men's attitudes by Jacques Ellul. It may cause you to look at all this abject nonsense in a new light.
Geomac
Wednesday, December 14, 2011 at 04:55 PM£170 a year for what exactly? Not security of supply, not to reduce CO2 emissions, not to replace fossil fuels (they are needed for backup) - so what are we paying for? To massage Alex Salmond's ego? To help fund "poor absentee" landowners? To boost the profits of foreign owned wind facilities? To keep employees of Scottish Renwables in a job? To stop Scotland being flooded by imaginary sea level rises? To help polar bears double their numbers - again!? To save the world from whatever it's called this week (global warming, climate change, climate chaos etc etc). Th illiterate and ignorant governments ot the EU, UK and Scotland had better get their heads out of the sand and get some unbiased input from engineers and develop a sensible and reliable electricity generation strategy - SOON!!
Simonsaid
Wednesday, December 14, 2011 at 04:46 PMSince when did minus 10 and snaw on the hills signal global warming?
Ron Greer
Wednesday, December 14, 2011 at 04:05 PMThe decision to let our deep mines flood was based on the worst form of political vindictiveness shown in recent times. It was also a shameful national folly. We should examine the potential for rehabilitation and cost this against the uselessness of wind turbines and the inapplicablity of large scale hydro and pump storage schemes. Even our near-surface reserves are very large in relation to our population size and internal demand requirement. The first thing is to secure an energy supply on which to base value-added production and services, before we pursue a pipedream that is not blowing in the wind.
Saoghal Beag
Wednesday, December 14, 2011 at 02:07 PM4. Coal based resource. Carbon trading is going to be a reality, like it or no. Therefore it is in that context that we have to look at new coal. With carbon allowances in place a new coal power station will be cheaper, in the long run, with carbon capture than without. However the real issue is that most of our deep coal reserves are no longer viable to mine, since our mines were closed they have flooded and put that resource out of reach. We do have near surface supplies, and they are low sulphur but these are limited resources that won't last forever and therefore we need to look further ahead for long term solutions. A balanced generation portfolio of diverse renewable technology along with current traditional generation seems a reasonable approach to me.
Saoghal Beag
Wednesday, December 14, 2011 at 02:02 PM4. Nuclear programme, Citigroup are really struggling to attract the necessary level of investment needed for new nuclear, they have embarked on a programme of trashing the major opposition while hounding westminster for subsidies and assurances that the new nuclear build will not have any responsibility for waste nor decommissioning. Meanwhile, following the great success of Thorpe and the Sellafield MOX plant (both abject failures) the UK government has decided to have a third go at it, £2.5B for nothing so far and counting, but that is chicken feed compared to the amount of money required to make new nuclear plant viable. Or do you still believe that nuclear will produce power so cheap it can't be metered?
Heinz Doofensmirtz
Wednesday, December 14, 2011 at 01:59 PMgood stuff....smug middle class twangers with solar panels can make money from pensioners and disabled using power cards.....seems like social justice is a priority of the snp.
Ron Greer
Wednesday, December 14, 2011 at 01:58 PM4 Spot on and we have oodles of low-sulphur coal near to existing thermal stations and the main demand centres of population and industry. We could use the money we are currently wasting on useless windfarms to fund improved coal-based thermal stations and do so in the knowledge that we will have no substantively measurable impact on world anthropogenic CO2 levels or climate change
Saoghal Beag
Wednesday, December 14, 2011 at 01:54 PM5, Yes in great detail.
Alternative (High Octane) Fuel Head
Wednesday, December 14, 2011 at 01:28 PMAnd another thing... Does DECC actually explain how they arrive at their fingures and justify them or is this just another thing that everyone is supposed to blindly accept? I sstrongly suspect the latter.
Alternative (High Octane) Fuel Head
Wednesday, December 14, 2011 at 01:26 PM#3: Firstly, we cannot "tackle climate change" because climate change is a natural process that has been happening for millions of years. Secondly, to suggest that by wasting all this money on something that is not a reliable main source of energy is insane. We would be far better off to re-open the coal mines, use coal as opposed to gas to fire power stations and embark on a nuclear power plant program. One day, everyone is going to wake up to the "Great Climate Change Lie" and realise how pointless and what a waste of their money all this "save the planet" nonsense is. I think that day is getting nearer and nearer.
Saoghal Beag
Wednesday, December 14, 2011 at 12:29 PMFrom DECC; The 2050 Calculator shows that the total âcost of the energy systemâ today is around £3,700personyear and that if we do not tackle climate change, the total cost of the energy system could be £4,682personyear on average over the next forty years.............I would consider DECC to be a more reliable source of information than the very biased lobby group and anit-renewable, Renewable Energy Foundation. So the choice, based on the quoted figures is an increase of £170 or alternatively to stick with a carbon based generation portfolio and have a £215 increase.
Back To The Future
Wednesday, December 14, 2011 at 10:49 AMAt long last the cracks are starting to appear in the Scottish Government's UNSUSTAINABLE support for renewable energy. Subsidising old and ancient technologies is a sure recipe for disaster.
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