huhne

When Chris Huhne announced the carbon budget for the period 2023-27 recently, as required by law under the terms of the Climate Change Act, the Department of Energy and Climate Change had this to say in a press release:

The carbon budget will place the British economy at the leading edge of a new global industrial transformation, and ensure low carbon energy security and decarbonisation is achieved at least cost to the consumer.

http://www.decc.gov.uk/en/content/cms/news/pn11_41/pn11_41.aspx

Well, I suppose he would say that, wouldn’t he. But what will the cost actually be?

According to a BBC report published the same day, which predictably makes an enthusiastic attempt to sell this absurd piece of economic self-destruction to the public, this is what is in store for us:

The Committee on Climate Change has forecast that to meet emissions targets the average household fuel bill will go up by £1 a week until 2020 when it will plateau out with no major rises after that.

http://www.bbc.co.uk/news/uk-politics-13417997

… and just what is that supposed to mean?

Taken literally, are we supposed to prepare ourselves for an eye watering £1 hike in our fuel bills for each and every week from now until 2020, in which case the increase in cost will be over £600 per week by then. Or is it supposed to mean that by 2020 the cost of domestic fuel will be only just £1 per week more than it is now, which seems equally improbable.

In any case, what has the cost of fuel in 2020 got to do with an announcement about a carbon reduction target seven years later? I suppose that whoever fed this titbit of spin to the churnalists in the BBC newsroom thought that muttering something incomprehensible about £1 per week would be enough to lull most readers into a complacent acceptance of grandiose plans to single-handedly save the planet while miraculously resuscitating the moribund British economy.

A quick check revealed that the press release on the DECC website makes no mention of a £1 per week increase in fuel bills, which is not particularly surprising. The briefings that friendly organisations like the BBC receive from government departments go well beyond the published press releases that people like bloggers, who may ask awkward questions, are allowed to get their hands on. However I did find this in the Notes for Editors section of the press release:

The Committee on Climate Change provided their advice http://www.theccc.org.uk/reports/fourth-carbon-budget) in December 2010.

So presumably that is where the BBC’s notion that completely restructuring the UK energy industry will only cost consumers £1 per week originated – or something.

Now that link leads to a report from the Committee on Climate Change which runs to nearly 400 pages, and I’m not going to pretend that I’ve read it all. On the other hand, I have spent a good deal of time searching it to try and track down the claim that “… the average household fuel bill will go up by £1 a week until 2020 when it will plateau out …”, and discover how this estimate has been arrived at.

No luck! Zilch! Nothing!

The DECC press release also provides a link to the full text to Chris Huhne’s ministerial statement to the House of Commons so casting the net a little wider, I tried that. These are some of the fragments that I found:

Signing up to an ambitious Fourth Carbon Budget will result in no additional costs to consumers during this parliament.

…..

Rising electricity costs pose a key risk to these sectors [energy intensive industries] which are critical to our growth agenda. We will, therefore, take steps to reduce the impact …

…..

Mr Speaker, it is important to stress that the UK’s existing policies already put us on track to meet the first three carbon budgets. They also provide a strong foundation for the fourth carbon budget, implying no additional near-term costs. [my emphasis]

http://www.decc.gov.uk/en/content/cms/news/cb_oms/cb_oms.aspx

It is hardly surprising that targets for cutting carbon emissions during the period 2023-27 will have no immediate impact on house hold fuel bills, and this tells us nothing about what the actual impact will be. There can be no doubt that the minister recognises that there will be additional costs associated with his plans, because he mentions this problem in connection with energy intensive industries. He finally claims that his plans will incur no ‘near term-costs’, whatever that may mean, but he skilfully avoids any reference to what the cost of the plans he has just presented to Parliament will be. And there can be no doubt that there will be considerable costs, can there?.

If anyone out there can point me to the source of the claim in the BBC reports that “… household fuel bill will go up by £1 a week until 2020 when it will plateau out with no major rises after that” I would be very grateful, because I find all this pretty confusing. Perhaps we are supposed to believe that the massive extra cost of carbon reduction will just vanish into thin air if it is not added directly to domestic fuel bills, and that the electorate will not notice at all. It would be interesting to know whether the Committee on Climate Change really did make this claim, and if so how they did their sums.

29 Responses to “HELP! Huhne and £1 per week cost of decarbonisation”

  1. 1
    geoffchambers Says:

    These are questions the opposition parties are paid to ask. They won’t. Thinking about why they won’t, and the situation resulting from the fact that they won’t, takes us far from questions of household fuel bills into deep questions about democracy and the society we live in. Maybe you don’t want to go there just yet. In the meantime, those living in Britain could do worse than pass TonyN’s questions to their MPs

  2. 2
    TonyN Says:

    Geoff

    Like you I am concerned that the system that is supposed to hold ministers to account in our legislature is not working in the case of AGW alarmism. So what’s on your mind?

  3. 3
    geoffchambers Says:

    What’s on my mind? Some question! What, apart from the perversion of science, the propagandist nature of our media, and the failure of our political system to discuss seriously the most expensive and far-reaching legislation ever passed by parliament?
    Looking at the progress of scepticism over the past three years, all I can see is a number of tiny forward steps stopped in their tracks, a few glimmers of hope quickly extinguished. With Justice Burton, Lord Lawson, Graham Stringer MP – establishment personalities applying normal processes of reasoning to an important subject – it seemed that the subject might come out of the closet and into the mainstream. Then Labour chose Ed Milliband, Cameron supported Huhne over the Treasury, without a peep out of the serious papers. Discussions of climate change have been rendered irrelevant by a consensus of politicians and the media.
    Meanwhile, on the blogs, hugely important people like the Government’s Chief Scientific Advisor, the Head of the Met Office, the President of the Royal Society, are exposed daily as clowns or worse – and nothing happens.
    One optimistic comment one hears is that the politicians will have to change their minds when the lights go out. But will they? Monbiot’s latest opinion piece in the Guardian is titled: “Support wind farms? It would be less controversial to argue for blackouts”. This is the radical investigative-journalist-turned-establishment-spokesman preparing us for the next stage of the propaganda war: it’s our fault if the lights go out because we don’t like pylons.
    What can we do about it? Well, if I was serious, I suppose for a start I’d sit down and read the 400 page report you refer to…

  4. 4
    TonyN Says:

    Geoff

    I think that your last paragraph (above) approaches the problem from one direction, while your reference to “… questions about democracy and the society we live in”, in your first comment approaches it from another, but possibly related one.

    Although sceptical bloggers are routinely accused of being part of a well organised and well funded campaign, so far as I am aware none in this country has receive any funding. Apart from a vague rumour I heard the other day that a sceptical blog in Australia, that I had never heard of, might have once got some money from a mining company, I am not aware of funding for sceptical bloggers elsewhere. Steve McIntyre who arguably has accomplished more than the rest of us put together, certainly doesn’t get any. Yet the people that we are up against have colossal resources at their disposal. They are in a position to chuck a 400 page door-stopper report at a team of researchers and tell them to come up with a strategy for criticising any shortcomings it may contain, or just producing a list of questions that should be asked. ANd then they can pass it to a well-funded PR department.

    In the States, at least there are think tanks with some resources, but here there is only the GWPF which, in my view is doing a good job, but on a budget must rely heavily on the commitment, energy and enthusiasm of those involved.

    To put it in a nutshell, where do you find the sceptical equivalent of the Grantham Institute, which has two representatives (out of nine) on the committee that signed of that report?

    The idea that I am nibbling at is this: it is society, in this country at least, that determines the way in which politicians conduct themselves. Just reading comments around the bogosphere, there is a significant body of public option that is desperately concerned about what is happening but, as you say, their views, questions, and criticisms are shunned by politicians and the media. How does one mobilise that recourse and make it un-ignorable?

    Just for fun, of the other committee members listed at the back of the report, don’t you just love this picture of a well known scientist with really well balanced views on all things ecological.




  5. 5
    peter geany Says:

    TonyN I to had wondered about the £1 per week. One thing I have realised is that whenever figures are banded about over costs in government these days a small number is chosen over a small and confusing period so that no one truly understands what is being said. You can bet your bottom dollar that what is being quoted could never be proven wrong for just the very reasons we can’t figure what it really means.

    And the whole issue goes back to Politics and the appalling lack of accountability we now have in our parliament. Cameron has been a huge and disastrous disappointment, and has demonstrated conclusively he is on some sort of crusade where he is trying to drive everything in a direction that he wants rather than the way people want. Economically they should be cutting taxes and stimulating the economy, instead we have income tax remaining high, driving out many top earners because they can, we have a north sea tax that has stopped investment in its tracks, we have a carbon tax that is driving all our high tech industry out as they are high energy users, and we have a high rate of VAT that is hitting the core consumer spenders hard. I write to my MP and try to engage him but just get a long list of platitudes. I don’t get the sense I am being listened to which tends to make my letters become every slightly shrill in tone.

    If you recall Cameron was going to reform politics and put it back with the people. Only thing is he has found that this is not going to work as several things have happened that don’t fit with his grand vision. The new intake of Tory MP’s has proven to be more Euro-Sceptic than he would like and in particular those chosen by open primaries. Cameron was heard to mutter in an unguarded moment recently “there will be no more primaries then”. If true this is hugely disappointing and a disaster for democracy. The man is just like Blair and Brown and cannot stand dissent, perhaps even more so than the former did. And if you check out the comments section on Media blogs where it was usual to get a lot of supporting comments I have been struck just how attitudes have changed and how disappointed everyone is with the government performance. One thing is certain he is not a leader, and we had our fill of Blair, and Blair mkII will not do.

    Bringing this back to the climate change bill, given that the government is making a hash of its current management, making all the moves that in the past have never worked, it would take a leap of faith on everyone’s part to think that Cameron and Huhne give the costs of compliance with the climate change bill even a seconds thought. But what is going to scupper them all is as I have said for a long time; there is no money left. The EU will make one last effort to prevent Greece defaulting, but it will only come at a cost of terrible social unrest. And it is only prolonging the inevitable and making the problem ultimately worse. If only our Politian’s could see this. Perhaps the fact that the US housing market is in double dip may register.

    One thing I do know. No matter how much power minister’s sign over to Brussels, our parliament remains primary, as the power is not theirs to give away. Even if they vote as they did recently to cede power to Brussels they could undo it in a blink. If a few more people realised this and wrote to their MPs it would cause a stir. It is perhaps what we have to do to wrest control of our country back where it belongs.

  6. 6
    TonyN Says:

    Peter G:

    If you recall Cameron was going to reform politics and put it back with the people.

    But will any premier, in this country at least, ever do this? What’ s in it for him or his party? Surely power is something that the people must wrest back from the politicians, and the primary responsibility lies with the currently supine electorate, and not with the politicians who are doing little other than behaving according to type. At least you are prepared to put time into writing to your MP, but how many others do so, while moaning in the pub? What stimulus is it going to take to galvanise a mass movement for change which no government can afford to ignore? It’s not impossible; just think of the countryside marching on London or the poll tax riots.

    Economically they should be cutting taxes and stimulating the economy, instead we have income tax remaining high, driving out many top earners because they can, we have a north sea tax that has stopped investment in its tracks …

    I haven’t followed this as closely as I should, although during the last oil price spike there seemed to be a consensus among analysts that the underlying problem was a global shortfall in investment in oil extraction coupled with rapidly rising demand from the emerging economies. Reserves were not seen to be a problem.

    Now, politicians who have invested much political capital in the crusade against climate change have an interest in seeing the cost of fossil fuels rise so that the gap between them and the alternatives which they are investing so much public money in appears to be narrowing.

  7. 7
    peter geany Says:

    TonyN, Your point about politicians, “what’s in it for them” is well made. I chastise myself for even for a second thinking that anything would change; perhaps the point I’m trying to make is that Cameron is as much a control freak as Brown, and by implication he is not a leader.

    The economics at present is not looking good. We get a couple of days of spin followed by more bad news. The news that 60 billion in mortgages have been turned into interest only should be alarming. So at present families are only just hanging in there. The average age of the first time home owner is going up and is now approaching 40! So we get some spin that Britain will soon be like Continental Europe and a country of renters. Only trouble is we will then have many many people of retirement age with nowhere to live as the UK is not the same as Germany. Our Politicians are playing a very dangerous game. And our landlords have a nasty surprise coming their way care of Chris Huhne.

    As for our energy policy, I saw a post recently that showed forward contracts for electricity this autumn are double what they are currently. All this pressure on the cost of living is going to make something break.

    And you are 100% correct in saying that it is up to us to rest back control from our politicians so that they represent the majority view and not the activist view. As I said above there is a change of mood in the blog sphere and our leaders need to pay attention or they will be over run.

  8. 8
    geoffchambers Says:

    The problem is that the country’s long-term energy policy is no longer being decided by the government, but by a committee of university professors handpicked to express a single point of view. The government’s sole role has been to rubber-stamp the CCC’s recommendation. The 400-page document you link to is therefore clearly the key to understanding government policy.
    After the briefest examination, I can say that it is biassed, misleading, incoherent, and probably factually inaccurate. Here’s a simple example.

    In Chapter 1: “Revisiting the science of climate change”, which summarises the current understanding of the science (including a review of “Climategate” and the IPCC errors)
    section(III) (page 50) “Long-term climate history before human effects” starts with:

    “The climate of the Earth has varied greatly over very long timescales. Past changes have been caused by various drivers, but it is clear throughout that CO2 and other GHGs have played an important role either as an initial trigger of change or as an amplifying feedback.”

    and ends:
    “Status: there is a high degree of confidence that temperature changes over the last million years have been amplified by closely-linked changes in atmospheric CO2 concentration”.

    Note the difference between “either a trigger or an amplifying feedback” in the opening paragraph and the simple “amplified” in the conclusion. The fact that CO2 rise follows temperature rise has been deliberately glossed over, revealing the document to be a dishonest propaganda exercise from the very beginning.
    There are more examples, but that’s enough for now

    TonyN #4
    I’m not sure the lack of resources is a problem. There are a dozen readers of your blog alone capable of taking this report apart, chapter by chapter, and demonstrating that the eminent scientists of the CCC have produced a highly partial, slanted report. They are being dishonest in my opinion, and it would not be that difficult to produce a detailed analysis to demonstrate the fact. The question is, are there any volunteers for such a mind-numbing exercise?

  9. 9
    tonyb Says:

    Geoff #8

    Try this by Paul M which I think Max contributed to.

    http://sites.google.com/site/globalwarmingquestions/ipcc

    tonyb

  10. 10
    peter geany Says:

    It just keeps getting worse. It was obvious to all but the dim witted that if the new incoming administration kept up with the failed interventionist policies of the outgoing mob, it would all back fire on them. Now I believe they are in such a muddle that only a general election will suffice and new leaders for the Parties in power.

    http://www.telegraph.co.uk/finance/newsbysector/energy/8551656/UKs-largest-gas-field-to-remain-shut-as-Centrica-blames-George-Osborne-windfall-tax.html

  11. 11
    TonyN Says:

    Geoff C:

    If you feel like coordinating a team to do exactly what you suggest, then I would be very happy to make pages available to you here.

  12. 12
    Alex Cull Says:

    Geoff, re your #8, I’ll certainly have a go at trawling through this document & will see what I can find.

  13. 13
    geoffchambers Says:

    Co-ordinate a team eh? What, with this bunch of eccentric individualists? OK. If there are at least two or three interested, including some with a better grasp of climate science than me (I’m looking at you, Max, and you Tonyb) and also of the economics, let’s give it a go.
    TonyN: please pass my email address to anyone who expreesses an interest.

    I suppose the result should be something like the link mentioned by Tonyb at #9, in which the IPCC AR4 is well demolished.

    Here’s an example of the simpler kind of demolition which anyone with an ounce of reasoning power could do. It’s the Summary of Chapter 1 “Revisiting the science of climate change”. The figures in brackets are in a big hexagon in the original. I’ve included them because without them, point 4) doesn’t make sense.

    Key Findings
    1) Global average temperatures from 2000-2009 were around 0.75°C above pre-industrial levels. (0.75°C)
    2) Limiting central estimates of global warming by 2100 close to 2°C will reduce (but not avoid) the risks from climate change.(2°C)
    3) Many societies and ecosystems will not be able to adapt to 4°C of warming. The risk of reaching this should be kept to very low levels. (4°C).
    4) The number of climate research papers reviewed by the Committee this year, providing us with the latest understanding of climate science. (500)
    5) Global CO2 emissions increased 6-fold over the 20th Century (6X).
    6) CO2 concentration has not been as high as today for at least the last million years, possibly much longer. (1 million years)
    7) The last decade has been the hottest since records began. (2000 to 2010)

    Comment:
    1) “above pre-industrial levels” – what, in 1750? Or do they mean, above levels c1950, when CO2 emissions took off? Who knows?
    2) This is meaningless. How can limiting estimates of anything reduce the risks of anything else? Do they mean “Taking the action which is currently estimated to limit…”?
    3) An unsupported assertion about what might happen at +4°C is presented as a reason for not reaching 2°C
    4) So the committee reviewed 500 papers. And that’s a finding?
    5), 6) So what?
    7) The standard way of disguising the biggest news of the decade – that temperatures haven’t risen for ten years.

  14. 14
    geoffchambers Says:

    Thanks Alex. Our posts crossed. I suppose the first bit of co-ordination to do would be to decide which bits each of us should tackle.
    TonyN: Since the site spring-clean, I no longer have those thingies for quotes, italics, etc. Is it because I use Safari?

  15. 15
    TonyN Says:

    Peter G & Geoff C:

    From what you are both saying, it would seem that you expect economic and political pressures are likely to add urgency to the climate debate before this year is out. I’ve been thinking along the same lines.

    A demonstration outside the Welsh Assembly Government in Cardiff recently attracted about 2000 determined, shouting, placard waving, opponents of a massive wind generation project that will blight the Welsh borders and Shropshire uplands. What was particularly encouraging was that a well known wildlife programme presenter and a TV weather person not only attended but went on record as saying that they were prepared to do direct action in order to protect the countryside they love.

    So here are some questions: What would it take to get sceptics to start doing rather more than just talking? Is it time to get militant? What action might they take that would not involve law breaking, but could, perhaps, start to get media attention and begin to concentrate the minds of our politicians and policy makers? What would precipitate mass action?

    I suspect that this is something that the blogs should consider airing. Perhaps it’s time to start preparing for a real change of pace. We are now only two years from the next IPCC report and it would be interesting to know what people think.

  16. 16
    TonyB Says:

    Geoff and TonyN

    The economics are fully detailed in my article that has been playing all week at Climate Etc.

    http://judithcurry.com/2011/05/26/the-futility-of-carbon-reduction/

    There is a useful table of likely costs fairly early on via a link.

    If this is what you were looking for someone posted an excellent critique of The Stern report which I can search out

    tonyb

  17. 17
    Alex Cull Says:

    Hi all, I’ve found what could be what the BBC were referring to, not in the Fourth Carbon Budget report but in the Renewable Energy Review of May 2011- link below:
    http://hmccc.s3.amazonaws.com/Renewables%20Review/The%20renewable%20energy%20review_Printout.pdf

    From page 36, in the Executive Summary: Part 4. Scenarios for renewable energy ambition:

    “We estimate that the cost of supporting renewable electricity to 2020 will add up to 2 p/kWh to the electricity price, increasing the average annual household electricity bill by around £50-60 in real terms.

    • Around half of this cost is due to supporting offshore wind.
    • There is also some cost from onshore wind, though by 2020 new projects are likely to be competitive without specific support.
    • This represents around a 10% increase on what household electricity bills would otherwise be in 2020.
    • It is around a 4% increase on households’ total energy bills, where electricity accounts for 40% of total energy costs and gas accounts for the remainder.

    There is the opportunity to offset the impact of higher prices through energy efficiency, which we estimate could reduce residential energy consumption by around 14% in the period to 2020.

    This would therefore more than compensate for impacts of renewable electricity investment, and ensure that the share of expenditure on energy relative to income remains roughly flat when allowing for upward pressure on bills from rising gas and carbon prices along with expectations of rising incomes.”

    I’m wondering whether this is where the £1 a week idea might come from, if there’s a £50-60 increase in the average annual electricity bill up to 2020, and as there are 52 weeks in a year.

  18. 18
    geoffchambers Says:

    Congratulations Alex on digging out the answer to TonyN’s question. This is what investigative journalists are paid to do.
    I note an oddity in the extract you quote from the CCC Renewable Energy Review
    “• It is around a 4% increase on households’ total energy bills, where electricity accounts for 40% of total energy costs and gas accounts for the remainder”.
    This suggests that transport is not counted in household energy bills. Surely that can’t be right?

    Thanks Tonyb for the reference. My idea was not to create a compilation of statistics to counter the CCC document, but to analyse it, specifically because it is the source of government policy. My interest is not in energy policy as such, but in the process of government policy-making. I’ve seen documents from the Department of Energy which are clearly honest attempts to clarify a complex subject, and I’ve seen marketing brochures. If we are to be governed by discussion documents, then those documents should be discussed by citizens, and there’s a lot we ordinary sceptics can do in that area.
    As you must know from your work on historical temperature data, the hard work of digging out and analysing data wins you respect, but promotes little comment. It’s in the nature of blogs that the superficial remark generates more comment than the solid research. That’s no reason not to do it, and I think it might be useful to have a stock of analyses, or meta-analyses of important documents, on the lines of Paul M’s site relating to the IPCC AR4, and Alex Cull’s site with transcripts of radio interviews.

    And that’s my answer to TonyN at #15. Plane Sensible? No thanks. I’m all for the kind of spontaneous protest movement he mentions. It’s geographically based and highly focussed. Anything we put together would be woolly and twitter-based, a twin of Monbiot’s Campaign against Climate Change. But of course, it should be discussed. I’m open to being persuaded.

  19. 19
    TonyN Says:

    Alex Cull, #17:

    That certainly looks like the source, or at least a source. The suggestion that onshore wind will become competitive by 2020 reminds me of the very dodgy costing technique used here.

    I hope to take a closer look at this next week, because plausible sound-bites like ‘converting to renewables will only cost £1 per week’ are immensely persuasive, and I suspect that they are also immensely misleading.

  20. 20
    TonyN Says:

    Geoff, #14:

    I’m having trouble finding a comments quicktags plugin that is compatible with the latest version of WOrdpress, but I am very concious that a solution has to be found.

  21. 21
    Alex Cull Says:

    TonyN, Geoff, I’ve tried to find another source for the reference to a £1 a week energy bill rise and plateau after 2020, but no real luck so far. Here’s an online article that states:

    However, the plans have faced criticism from consumer groups, as they will create an average rise in energy bills by £1 per week by 2020. Roger Harrabin, environmental analyst for the BBC, told yesterday’s Radio 4 Today programme that the government has not done enough to smooth over confusing regarding the plan.

    The article is dated 18th May, and the item on the Today programme would thus have been on 17th May, but it is not in the day’s excerpts; either the ClimateAction article is incorrect, or there was a segment with Roger Harrabin on this subject, which just didn’t end up included in the running-order links.

    Going back to the report I linked to above, there’s a little more re the “plateau” on p38:

    The story in the 2020s is therefore likely to be one of more modest price rises than during the 2010s, and with average energy bills falling relative to income, assuming incomes continue to grow.

    I’m assuming this appears to be because, under the scenarios they have created for power, heat and transport up to the 2030s, renewable energy becomes more competitive and cheaper, as an increasing carbon price makes “unabated fossil-fired generation” more expensive (this is where the creative accounting comes in).

    Geoff, re transport, there’s a relevant paragraph at the bottom of p36:

    Renewable energy in transport is not expected to add to motoring costs as biofuels are expected to be a similar cost to petrol and diesel under central assumptions for the oil price. We have factored the increasing cost of electricity into our analysis of the cost effectiveness of electric vehicles and electric heat pumps.

    So CCC think that increased EV use would be part of the £1 a week rise and presumably oil prices remaining high would make biofuels competitive – so no net prices rises in the transport category, apparently. There’s more detail on pages 158-161.

    Re wind power, CCC’s position appears to be that onshore wind will be competitive with gas CCGT by 2020 but offshore wind will not be competitive by then, hence the recent reservations expressed by CCC re offshore wind. Here’s a recent interview with Lord Adair Turner on BBC’s Today programme, where he talks about amending the renewables targets for 2020 by temporarily reducing investment in offshore wind:

    (As an aside, there’s a moment halfway through the interview where he appears to be mentioning a solution similar to DESERTEC in order to meet the UK’s renewable targets for 2020. Given the colossal technical and political hurdles involved, I’m inclined to be a little sceptical.)

  22. 22
    Alex Cull Says:

    Now here’s a bit of a disconnect. Scottish Power are raising their prices – 19% for gas and 10% for electricity. UK Retail Director Raymond Jack ascribes this to a number of things – rising wholesale prices, volatility, market unrest. And, according to this Reuters article:

    He said costly government programmes for meeting environmental and social targets and high transmission expenses were also reasons for the tariff rises.

    Chris Huhne, however, singles out high oil prices:

    “But it underlines why the government is building an escape route from a high fossil fuel future. We need to get off the oil price hook and on to clean, green growth,” he said in a statement.

    It will be interesting to find out exactly how much of the electricity price rise is precisely due to “clean, green growth”.

  23. 23
    tonyb Says:

    Alex

    It is govt policy to provide a ‘level playing field’ for all fuels to compete on and to do this they are deliberately edging up the price of fossil fuels by way of taxes, scarcity etc so renewables can compete. I see scope for another 25% in the next year as fuel becomes steadily more scarce and govt policies drive its price up quite deliberately, I ‘fixed’ my energy costs earlier this year for 4 years. By that time it could well have virtually doubled from the prices I paid in 2008.

  24. 24
    TonyN Says:

    Alex:

    I think Harrabin’s report was part of the 08:00 am news bulletin.

    And I can’t remember a reliable report before of a senior energy company executive blaming a rise in the cost of electricity, in part, on the government’s green programme. Reuters are usually pretty reliable, and I do hope Mr Jack’s interjection will give others the courage to speak out. Why should they do otherwise when they know that the flak for rising prices will be directed at ‘greedy’ power companies?

  25. 25
    geoffchambers Says:

    Barry Woods has a interesting article about the internal government battle over the CCC-recommended Carbon Budget at WUWT
    http://wattsupwiththat.com/2011/06/07/green-economic-thinking-revenge-not-economics/#more-41116
    Readers of Harmless Sky, remembering TonyN’s comments on the Inconvenient Truth case will appreciate the irony of this:

    “The carbon budgets only went ahead because the (equally unelected) environmental lobby groups threatened a Judicial Review”.

    So the government gives in to a lobby group after being threatened with being taken to court for not giving in to an advisory committee set up by an Act of Parliament essentially written by the lobby group.
    What does constitutional government count for, compared with reducing average global temperatures by .01°C?

  26. 26
    peter geany Says:

    I don’t think this country has ever has more useless government. Its going to take a day or two for me to think of a response, that is if fatigue doesn’t set in.

  27. 27
    Alex Cull Says:

    Tim Yeo, Chairman of the Energy and Climate Change Select Committee was on the radio a couple of days ago, talking about the price hikes (excerpt below, and more here):

    Justin Webb: What Scottish Power also said is that costly government programmes are partly to blame for the price increases. They say “meeting environmental and social targets” – on environmental targets, I mean, you do wonder whether the enormous amount that we’re having to pay to subsidise wind farms to get them off the ground is actually behind a lot of this. A lot of consumers will wonder whether that is, perhaps, money that – you know, slightly better, if people are – this is a serious issue for people, if people are potentially dying of hypothermia as a result of not being able to pay bills, maybe we should think a bit more about protecting people who are currently alive rather than future targets for carbon reductions.

    Tim Yeo: Well, at the moment, such a tiny proportion of electricity in this country is generated by renewable sources, such as wind, that –

    Justin Webb: You know, a lot of money going towards it –

    Tim Yeo: Well, in the future, there may be more money going towards it, certainly, but Scottish Power, I think, are being a bit disingenuous here. The truth is that, at the moment, the amount of money going to renewables is very, very small. It will become greater, it is perfectly true –

    Justin Webb: And that will force up prices.

    Tim Yeo: Well, it is perfectly true that greener energy, and more secure energy that is sourced within the UK, rather than imported from Russia, is likely to cost more, so the issue about consumer prices is going to get more intense. And one of the factors undoubtedly is the drive, which I fully support, the drive towards more low-carbon electricity.

    It’s interesting that when the emphasis is on performance, the stress is also on how much electricity is generated by renewables (as in this article) but when the emphasis is on costs, the stress is still on how little it is. And note the way Tim Yeo straightaway mentions the proportion of electricity that renewables generate, rather than about the cost to set them up, which was what Justin Webb was actually talking about, in this interview.

    Also, note his comment: “The truth is that, at the moment, the amount of money going to renewables is very, very small.”

    But as he points out, this is going to rise. And I don’t find it inconceivable that Scottish Power are raising electricity prices this year, in part to fund future costs under the government’s Carbon Reduction Commitment. This is from the summary of a report from Verdantix in October last year entitled “UK Government Hits Businesses With Carbon Tax” (emphasis mine):

    The UK government announced that HM Treasury will retain 100% of funds from sales of carbon emissions allowances sold by the government to between 3,000 and 5,000 private sector and public sector organizations covered by the Carbon Reduction Commitment (CRC). Participants in the CRC must pay for their allowances in April 2012 to cover the compliance year that begins April 2011. This radical policy change imposes a carbon tax equivalent to a 9% to 11% increase in electricity prices.

  28. 28
    Alex Cull Says:

    Having said all that, I just remembered that energy companies are not included in the CRC but are covered by the EU ETS instead. The CRC applies to large companies not in the EU ETS, and thus the carbon tax mentioned by Verdantix will go straight to HM Govt without involving the energy companies.

    More about these schemes here. Good quote from Ben Wielgus of KPMG:

    Ben Wielgus, of KPMG’s climate change and sustainability practice, said “We find CRC participants in the difficult situation of paying for carbon emissions three times – once through the CRC, once through the climate change levy (CCL) and once through the cost of carbon charged by their electricity companies through energy bills.”

  29. 29
    Alex Cull Says:

    Chris Huhne is now blaming the public for being apathetic and lazy, when it comes to saving money on fuel bills, according to the Times (paywalled, so here’s the story as reported in the Guardian.) I find it reminiscent, in its way, of David Miliband accusing the public of being apathetic and lazy about climate change, about this time two years ago.

    In an interview with the Times, the Liberal Democrat said: “They frankly spend less time shopping around for a bill that’s on average more than £1,000 a year than they would shop around for a £25 toaster. If they got that in perspective and said, ‘OK, we are going to spend a little bit of time shopping around’ (they) could save very substantial amounts of money.”

    He said 85% of households do not shop around, and challenged customers not to “just sit back and take it and succumb to the myth that all energy tariffs are the same”.

    However, further down:

    Mr Huhne has reportedly asked regulator Ofgem to pursue a complaint that the large energy companies are squeezing out smaller suppliers with impossibly cheap deals.

    So on the one hand, it’s our fault that we’re not shopping around for the cheapest deals, but on the other hand, the big energy companies shouldn’t be offering these very cheap deals in the first place.

    Mad Hatter logic at its finest.

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