WITH just two days to go of the UK Government’s consultation on ending feed-in tariff subsidies for wind and solar power, renewables industry representatives have called for consumers to be given “the full picture” on subsidies.
A new report shows that the renewables industry is massively cutting the wholesale price of energy and lessening the impact of subsidies on bill payers – for solar power the net subsidy could even be “zero”, according to the industry trade body.
Nor is wind power costing any more than any other source of electricity to cut carbon emissions, in the words of a leading academic.
The premature end of subsidies threatens thousands of jobs and millions of pounds in investment in Scotland’s green energy production, according to the renewables industry, just at a time when the cost of solar and wind power is falling.
The report by independent energy company Good Energy, backed by experts at the University of Sheffield, states that wind and solar energy brought down the wholesale cost of electricity by £1.55 billion in 2014.
That meant an overall net cost for supporting the two renewable sources last year was £1.1bn, 58 per cent less than the cost reflected in the capped budget set for green power subsidies, known as the levy control framework.
Earlier this week, the Solar Trade Association announced its “£1 solar rescue plan” as part of its campaign to save the feed-in tariff from the extreme suggested cuts.
The association said: “If enacted, our plan would add just £1 onto consumers’ bills by 2019. The current plans are set to decimate the solar industry and could put up to 27,000 jobs at risk.
“We believe our plan will help to secure an adequate level of solar deployment to prevent industry supply chains unravelling.”
Paul Barwell, chief executive of the Solar Trade Association, went further: “With the Government’s consultation on the feed-in tariff review closing this week, this report is very timely.
“This analysis shows that the net effect on bills of supporting new rooftop solar under the STA’s £1 plan is zero.
“The £100 million we need added to consumer bills over three years will be completely offset by the savings from solar lowering the wholesale price. This is just the evidence the Government needs.”
Good Energy’s chief executive Juliet Davenport OBE said: “This analysis puts the bill payer at the centre of the debate around renewable energy subsidies. Let’s give them the full picture and not just half of it.
“What is not taken into account is the fact that renewable energy, such as wind and solar, has actually been bringing the cost of energy down for consumers.
“The bill payer’s money invested into supporting renewables yields significant benefits, let’s be very clear about that.”
Experts from the University of Sheffield have backed the report and are about to publish the results of their own study on the savings onshore and offshore wind are contributing to wholesale energy costs.
Dr Lisa Clark of the department of physics and astronomy at the University of Sheffield said: “Decarbonising electricity generation is critical for the future sustainability of the planet. In the UK, wind is a really important source of renewable electricity.
“At the moment the costs of renewable subsidy schemes such as feed-in tariff and renewable obligation have cast doubt over the future of renewables.
“But there are very few reports of the actual financial savings from renewable generation like wind and existing savings to consumers.
However, this report provides clear evidence that UK wind generation is typically saving UK consumers around £1.5bn per year.
“This is more or less the same amount that the subsidies cost. At the University of Sheffield we have recently finished a similar study and we find very similar numbers.
“So not only is wind energy decarbonising our electricity generation, it isn’t costing any more than any other source of electricity to do so.”
Michael Rieley, senior policy manager at Scottish Renewables, said: “This report shows that the benefits of renewable energy go far beyond the obvious – carbon savings and economic and employment benefits – and also include lower wholesale energy prices.
“Reports have consistently shown renewables are the cheapest way of generating electricity while achieving our carbon targets. This report shows that the wider contribution of green energy should be taken into account when the Government is making complex policy decisions on our power mix.”
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