From NOT A LOT OF PEOPLE KNOW THAT
By Paul Homewood
It’s official! Renewable energy is definitely cheaper than fossil fuels and the tens of billions we pay out to subsidise reduce your electricity bills!
It must be true – the BBC’s Executive Complaints Unit says so!
I complained about a BBC World at One soft soap interview with the lobbyist for the wind industry, Adam Berman, a few months ago. He was allowed to get away with the lie that renewable energy is cheaper than gas power, and that our electricity bills are high because of the price of gas.
I covered the story here.
Predictably the ECU has rejected my complaint. In doing so they have totally ignored the evidence I sent them, viz:
1) Fiscal data from the OBR regarding Environmental Levies, aka subsidies for renewables, which will amount to £17.1 billion this year, all of which is added to bills.
2) Costs of grid balancing, which amount to £2.6 billion, nearly all of which are incurred because of the intermittency of renewables, and all of which are added to bills.
3) Details of subsidies paid out via CfDs, which specifically destroy the notion that renewables are cheaper.
4) Details of other subsidies, such as Renewables Obligation.
Not only did the ECU ignore this evidence, they failed to refute it or explain why it was in any way irrelevant to electricity bills.
In rejecting my complaint, the ECU concluded:
In my judgement, the interview provided a duly accurate and clear explanation of how the UK electricity market functions. It served to clarify the complex relationship between gas prices and electricity costs, and the role of renewables in the current day to day pricing structure.
Bear in mind that the specific topic of discussion was “why are UK electricity prices so high?”. It was not a discussion of how the market works. As such the ECU’s response is not relevant.
As for the ECU’s “proof” that renewables are cheaper, they state:
In the second half of 2021 and most of 2022, the price of gas significantly increased because of market changes after Covid-19 restrictions were lifted and Russia’s invasion of Ukraine. This has made renewables comparatively even cheaper.
Even before the rise in gas prices, new renewables schemes were able to generate electricity more cheaply than fossil fuels. In 2021, the global average lifetime cost of electricity generation for new solar panels and hydropower generators was 11% lower than the cheapest new fossil fuel generator, while onshore wind was 39% lower.
The fact that gas prices spiked in 2022 have no relevance to why prices are so high now.
As for the second paragraph, they link to this report from the International Renewable Energy Agency:
https://www.irena.org/publications/2022/Jul/Renewable-Power-Generation-Costs-in-2021
Their theoretical costings are global ones, based on new construction and have no connection whatsoever to the actual prices and subsidies paid out in the UK for wind and solar farms built years ago, or that still continue to be built.
Why does the ECU need to go back to a theoretical study published four years ago and based globally, when there is the actual data readily available?
It is not theoretical costings that determine our bills, it is what we actually pay to generators.
The ECU also wheel out that old BEIS study from 2023, purportedly showing that new build renewables are cheaper.
In addition, the most recent Government assessment of electricity generation costs shows the levelised cost of electricity from wind and solar is generally lower than for gas-fired generation.
The same report they wheel out every time this issue is raised. Whether they are cheaper is irrelevant, because wind farms built in future don’t affect current bills.
But what really struck me was this section at the end of the ECU letter:
However, I think it is worth noting Contracts for Difference provide low carbon generators with a guaranteed price per MWh of electricity generated but they also mean generators have to make payments back to suppliers if the market price of electricity is higher than the guaranteed, so-called “strike” price. My understanding is most CfD strike prices are currently below the wholesale market price.
My understanding? What does “your understanding” have to do with anything? Is it so difficult to get hold of the facts?
I presented the facts surrounding CfDs, which conclusively show that “your understanding” is false. So why do you still maintain otherwise?
So, just to make this crystal clear. The OBR say that CfDs will be paid a subsidy of £1.4bn this year, and this will increase in the next four years:
https://obr.uk/download/economic-and-fiscal-outlook-march-2025
And on a monthly basis, subsidies have been paid throughout the period of the scheme, except for a few months in 2021/22:
https://data.spectator.co.uk/energy
The response was sent by Colin Tregear, who you may recall is off on a six-month course with the Oxford Climate Journalism Network, which aims to make the ‘climate crisis’ a central element in the journalism of the attendees.
The ECU will always defend the BBC against complaints, regardless of the facts.
But this latest judgement proves that it is also prepared to defend the BBC’s Net Zero agenda, come what may!
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