Davey calls for more RE spend

Former Liberal Democrat energy secretary and MP Sir Ed Davey has called on the UK government to increase renewables spending after official estimates showed consumer bills are expected to be £97 lower than previously forecast.

DECC figures unveiled following a Freedom of Information request by Carbon Brief state the government’s cap on renewables spending, the Levy Control Framework, will reach £8.63bn in 2020/21.

This is up from the previously forecast £7.6bn due to a combination of falling wholesale power prices, larger than expected renewables deployment and inaccurate load factor forecasts.

The £12 increase in consumer bills as a result of the higher spend on renewables is heavily outweighed, however, by falling fossil fuel prices. According to DECC, consumer bills will total £1,222 in 2020, down £97 or 7% from the previous forecast of £1,319.

Davey, now chairman of Mongoose Energy, said the government should allow the LCF to be overspent by 20%, as he agreed with Chancellor George Osborne during the previous Coalition administration.

“Energy prices for consumers will not rise if the previously agreed 20% contingency for low carbon electricity is used – because that contingency should only come into play due to wholesale energy prices themselves being substantially lower, driving down net energy prices for people.

“Osborne’s decisions on renewable energy aren’t just bad for the climate, and bad for jobs and investment, they are irrational. By failing to use the 20% contingency on top of the LCF, which I had agreed with George Osborne, the Conservatives are butchering the UK’s renewables on the basis of Alice in Wonderland economics.”

Image: Sir Ed Davey (Iberdrola)