An “ambitious” independent review of energy costs will not consider gas bills, suppliers’ profits and prices, smart meters or projects such as Hinkley Point, the government has admitted. The business department said yesterday that Dieter Helm would lead the review, promised in the Conservative manifesto, which it said would “ensure energy is affordable for British households and businesses” and would recommend “ways to keep energy prices as low as possible”. However, the option of capping energy prices, promised by Theresa May before the election, will not be considered by the review. Professor Helm, who previously has been critical of the cost of renewables, said that his review would “sort out the facts from the myths about the cost of energy”. Despite this, it emerged yesterday that large areas of energy costs would be off-limits for the review, which the professor, supported by a panel of industry experts, will have only three months to complete. Although the government said that the review would “consider the whole electricity supply chain – generation, transmission, distribution and supply”, the business department said that it was “not looking at pricing by suppliers and their practices” and would look only at “underlying costs”. The review also will not consider the costs of the smart meter rollout, one of the factors that British Gas blamed for its price rise.
Times 7th Aug 2017 read more »
One of the UK’s leading energy experts, Dieter Helm, will undertake a wholesale review of how to ensure a cost-effective energy supply for the UK, as the government seeks to allay fears around cost, security and reliability. Prof Helm, a professor of economic policy at Oxford University, will examine all elements of the UK’s energy supply chain, from generation to supply to individual consumers. The review, announced on Sunday by the Department for Business, Energy and Industrial Strategy, stems from a commitment made in the government’s industrial strategy green paper in January, when it said it would conduct a review of how to deliver affordable energy and ensure clean growth. However, the issue has taken on extra charge since the general election. Before the election, Theresa May, prime minister, promised to cut bills for 17m households, a pledge that has since been considerably watered down. It also follows controversy over British Gas’s decision to raise electricity prices for many consumers by 12.5 per cent, despite falling wholesale energy prices. The supplier blamed the rise on the effects of government policies on its costs. There are long-term concerns both about whether the UK will have sufficient generating capacity to meet its future needs, particularly at peak times, and the costs of the electricity. The country is obtaining a rising share of its energy supply from more intermittent sources, such as wind and solar power. But the deal struck to ensure the building of the £20bn Hinkley Point nuclear power station, which should provide reliable, round-the-clock electricity, ties consumers into paying what the UK government’s spending watchdog has warned could be £30bn more than market prices for the energy.
FT 6th Aug 2017 read more »
According to a leading engineering consultant, on-shore wind farms could be built in the UK for the same cost per unit of output power as new gas power stations and nearly half the cost (per unit of output power) of the Hinkley Point C nuclear plant. Indeed, Arup found that wind-power technology has become so cheap that developers could deliver turbines for a guaranteed price of power that would be effectively subsidy-free in terms of the impact on household energy bills.
Machinery Market 6th Aug 2017 read more »
