Keeping the lights on…

Barring the N words (nimbys and nuclear), energy policy has been remarkably lacking in party politics since the privatisation of the electricity market in the nineties.

However, this relative détente has been slipping away in the past year, and in the coming 12 months we may see a fight over the how the government keeps the lights on.

Energy policy across Europe, Northern America, and increasingly emerging economies – rest on three prongs; security, affordability and sustainability. The coalition government are about to fundamentally change how all three will be done in the UK for the coming decade.

With the debacle of seeing Energy Minister Greg Barker slash Solar PV subsidies, not once, or twice, but a three times in the past year still leaving a sour taste in many people’s mouths (as well as scaring the bejesus out of any foreign investors). The government are changing the way the market is run, aiming to incentivise the estimated £200bn needed to meet out legal climate targets.

These changes are designed to incentivise new nuclear (probably not the best time to mention that half of DECCs budget is spent on decommissioning our old nuclear stations) and off-shore wind (the most expensive renewable technology, rather than the cheapest renewable technology – on-shore wind), both decisions, in my humble opinion, are based in realpolitik, rather than any monetary or environmental decisions.

The barriers being placed on gas and on-shore wind (as well as the torpid pace both parties have demonstrated in supporting the UK marine energy sector), are all furtive areas of discussion, and my favouring of a more gas/wind/tidal balance is as good a gamble as the one the government are making (its not, obviously, but that magnanimity is based more on the fact that some decision has to be made soon).

The more worrying aspect is what the government are going to do to protect people from the inevitable rise in their fuel bills.

Their main hope is based in the Green Deal, this is the plan where people will be offered loans to pay for better insulation. On a small piece of paper, this policy seems like a great panacea, an ingenuous idea, possibly spouted from a dinner party conversation, but has lead to reams of problems. The main one being it’s hard enough to give away free insulation.

Its hard not to wish the scheme luck, but the inevitability of raising bills looms large, and the green deal isn’t even going to touch the sides. The government estimates that their policies will reduce the average 2020 energy bill by £94 compared to what they would be due to a combination of insulation, grants and subsidies. However, for those in the bottom two deciles that don’t qualify for any help, energy bills could go up by nearly a quarter, affected more dramatically than any other income group.

We need to be fighting for a fairer deal for people struggling to heat and power their homes, and with fuel poverty expected to rise to a third of UK households by 2016, we will need to have a strong plan for the next election.

But, this year will be a crunch one, and we have to take it to the coalition, a good start would be supporting this campaign www.energybillrevolution.org, something I urge you all to do.