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United Kingdom

United Kingdom

Regulator attacks renewables again

Britain's energy regulator, Ofgem, continues to talk up the cost burden on customers of renewables-but this time by the more indirect means of quoting comments by third parties in one of its own press releases. While celebrating the successes of two years' operation of its new electricity trading arrangements (NETA), which have pushed down wholesale electricity prices, Ofgem takes the unusual step of quoting comments from businesses which include attacks on the cost of renewables.

"Businesses are already burdened with environmental taxes, both the Climate Change Levy, which is unique to business and renewables requirements," says Bob Spears of the Utility Consumers Consortium. "After the recent White Paper on Energy Policy, this burden seems unlikely to decrease," he adds.

Regulator Callum McCarthy is known to lack enthusiasm for renewables and seemingly rarely misses an opportunity to stress the costs to consumers of increasing renewables' share of the power market. Ofgem believes emissions trading to be more effective than renewables in combating climate change. In its new corporate strategy, it states it will work with government to "develop emissions trading as the most efficient means of delivering reductions in carbon emissions at a national and European level."

Energy minister Brian Wilson has repeatedly acknowledged that NETA imposes cost penalties on renewables -- particularly wind. But despite some small amendments by Ofgem to help small and distributed generators, McCarthy has refused to make the more substantial changes to NETA that would reflect the true costs to the system of renewables generation, which are far lower than the penalties imposed upon it.

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