David Cameron says wind energy must get cheaper

Households are currently paying record high fuel bills due to fossil fuel prices and ‘green taxes’.

Every energy company is obliged to generate a certain amount of electricity from ‘green’ sources like wind and the extra cost of this is passed onto consumers.

The so-called ‘Renewable obligation’ already adds around £20 to the average energy bill every year and this is expected to go up to more than £50 by 2020.

Mr Cameron said the ‘green taxes’ should come down.

“As costs fall so it is right that consumers should pay less in subsidies for new projects,” he said.

“We don’t just need greener energy – we need cheaper energy too.”
The cost of onshore wind is already falling and is now on a par with coal and nuclear, though it is still more expensive than gas.
There are already more than 3,500 turbines onshore in the UK and this is expected to increase as part of Government policy to more than double capacity.

Mr Cameron said energy companies must get the costs down further.
“We can get these costs down further. I really believe that more mature renewable technologies can be among our cheapest energy sources within years, not decades,” he said.

Mr Cameron’s first major speech on green issues for two years was welcomed by commentators in the energy sector.
It was seen as riposte to Tory backbenchers who have complained about the growth of wind power in the UK, while reassuring those in his party who fear that the cost of renewables is too much.

“Our commitment and investment in renewable energy has helped to make renewable energy possible,” he said.

“Now we have a different challenge. We need to make it financially sustainable.”

"The industry is far too busy counting all this money to worry about 'financially sustainability'. They couldn't care less; their boots are full or soon will be."

Richard Lloyd, executive director at the consumer champion Which?, said the Government - not just energy companies - need to work to bring down bills.
"We welcome the Prime Minister discussing green policies and the need to be financially sustainable, but once again the Government seems to forget it also needs to be affordable for consumers who are the ones left picking up the bill.

"Too many of the Government's green initiatives are ill-thought out and look set to be ineffective and costly - from the £11bn smart meter fiasco, the poorly planned Green Deal, the feed in tariff where costs have tripled and the carbon floor price that will push up fuel bills without incentivising investment.

"People tell us that soaring fuel bills are their number one financial concern, so as the country enters recession once again, we want to see policies that will encourage consumers to save energy and protect them from volatile future prices, but not at any price. The Government must offer consumers a fairer deal."

Dr John Constable, Director of the Renewable Energy Foundation, said the total cost of renewables to the consumer is £60 per annum and it could rise to more than £300 by 2020.
He was doubtful the falling costs of green energy will be passed onto the consumer.

"Income support to renewable electricity generators last year cost the consumer £1.5 billion, over half going to wind power, and by 2020 this will be around £8 billion a year," he said.

27/04/2012 - telegraph.co.uk

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27/04/2012 - Telegraph.co.uk

Britain at risk of gas and electricity 'squeeze' by 2015

Alistair Buchanan, chief executive of the UK’s energy regulator, said “tightness” in electricity supply could come at the same time as a “squeeze” on gas by the middle of this decade.

His remarks suggest household are heading for higher energy costs, even though they are already paying near-record gas and electricity bills of £1310 per year.

Speaking at a conference in Amsterdam, the energy chief admitted a squeeze on gas and electricity supply could cause “a very interesting issue on price”.

Energy bills are unpredictable because gas prices can be affected by anything from unrest in the Middle East to maintenance work on platforms in the North Sea.

However, there is a particular risk that prices will begin to creep up around 2015 because Britain is closing many of its coal-fired power stations to comply with European rules on pollution.

Gas-fired power stations will have to be built to replace the coal. But Mr Buchanan is concerned that gas may be increasingly expensive to import on ships from abroad, as countries around the world compete for supplies.

“That squeeze and tightness in electricity could come at a time when you’ve got a squeeze in the LNG [liquefied natural gas] market,” Mr Buchanan said.

Mr Buchanan suggested the situation will be made worse by the end of the decade due to delays in building nuclear power plants and wind farms.
Britain’s first new nuclear power station was meant to be built at Hinkley Point by 2017 to help offset the effect of closing coal stations.

However, it has been delayed until 2019 at the earliest partly because of new safety standards following Japan’s Fukushima nuclear disaster.
“Frankly if I took a vote in this room, I don’t think we’d see any hands expecting Hinkley Point nuclear station this side of 2020,” Mr Buchanan said.

“Rather than moving very quickly to a land of renewables and nuclear, we’re actually going to lean on gas a lot more.”
Tom Pering, energy analyst at Inenco, agreed that a problem is looming in around 2015 or 2016.

“We’re going to have to find something to replace coal or it is inevitable we will face higher prices,” he said. “Delays to nuclear will definitely prolong the duration of time that we have supply issues and we’ll have to find something in its place.”

Financial experts warned earlier this month that Britain is facing higher gas prices this winter as it becomes more dependent on supplies from abroad.
Gas production from the North Sea fell “precipitously” by 10 per cent last year leaving the UK more reliant on cargoes of liquid gas from the Middle East, according to the experts from Merrill Lynch.

There is increasing competition for these shipments from Asia, especially Japan, which is replacing many of its nuclear plants with gas-fired power stations after its atomic disaster last year.

18/04/2012 - Telegraph.co.uk

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One in four energy bills contains a nasty shock for gas and electricity customers

One in four energy bills contains a nasty shock for gas and electricity customers – because they turn out to be incorrect.

Perhaps that’s no surprise when there are 120 different energy tariffs on offer – and much of the utilities’ work in assessing bills or dealing with customer queries is done by computer or call centres in countries where English may not be the first language.

What is surprising, though, is that the energy companies’ mistakes are not always made in their favour. According to research by the comparison website uSwitch.com, more than one in three households have unexpectedly owed money to their energy supplier, following a discrepancy between an estimated bill and ‘real’ bill.

And the average amount owed following a billing discrepancy is £152 – a nasty shock for householders on a tight budget. Even those for whom such a sum might be small change may be irritated by the hassle of putting energy company mistakes right; this process usually takes just under two months.
No wonder there is widespread cynicism about energy companies and two in three customers cannot be bothered to switch, despite big differences between the cheapest and most expensive providers of gas and electricity.
For example, Moneysupermarket calculates that for a typical household, the cheapest online tariff is from First Utility (iSave v10) at £1,027 a year. The most expensive standard tariff is from Scottish Power at £1,349.

So, switching from the most expensive standard deal to the cheapest online deal would save £322. People who believe that rising global demand for gas and electricity mean costs must rise in future may prefer a fixed rate deal, where the initial saving is slightly lower; the cheapest among these is from npower (Go Fix 11) at £1,033.

Ann Robinson, a director at uSwitch.com, said: “Consumers are paying hundreds or even thousands of pounds a year on household bills – the least they should expect is for these bills to be accurate.

“Billing blunders can cause consumers to end up out of pocket, as well as wasting time and effort trying to get the issue resolved. The fact is that households have to deal with wildly varying standards when it comes to accurate bills, with some industries performing noticeably better than others and some consistently bumping along at the bottom of the class.

“The energy industry is worst for inaccuracy, ahead of banks, council departments, credit card companies and other utility companies – only the Inland Revenue trumps it for getting bills wrong.”

Still, we can all make mistakes. HM Revenue & Customs has been the taxman’s preferred monicker for several years now.

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Centrica boss gets £4m bonus... on top of last year's £10m earnings when profits fell by £1.5bn

The boss of British Gas owner Centrica has scooped a £4million bonus – on top of the £10million he made last year.

Sam Laidlaw’s incentive payment comes despite the fact that his firm has plunged millions of its customers into misery with inflation-busting rises in their energy bills.

British Gas, which provides power to 13million families in the UK, last year hiked household bills by 18 per cent for gas and 16 per cent for electricity.
Mr Laidlaw’s performance-related payment also comes despite the fact that Centrica saw its profits fall by more than £1.5billion over the past year – from £2.8billion to £1.27billion.

His £10million earnings were revealed in Centrica’s annual report for 2011, published a fortnight ago.

The £4million windfall revealed last night comes after two of the group’s many long-term incentive schemes paid out. The staggering amount is enough to pay the average family’s energy bill for the next 3,000 years.

Mr Laidlaw, Centrica’s chief executive, received company shares worth £3.4million as the delayed instalment of his 2009 bonus.
And he was gifted another £620,000 in shares from a second long-term plan, which also dates back to 2009.

To receive both amounts, he was required to hit performance targets. The same two schemes last year paid out £3million to the energy chief.
Last night, the payout was greeted with disgust by critics.

Labour’s energy spokesman Tom Greatrex said: ‘It is astonishing that there are even further massive payments to the chief executive of Centrica at a time when the firm’s customers are facing the pressure of increased bills and their incomes are being squeezed.

‘If this is a performance-related bonus, it begs the question as to what they consider to be effective performance.

‘It shows that fundamental reform of the energy market is needed, because at the moment it is not serving the interests of consumers.’

Paul Green, of over-50s group Saga, warned that fuel poverty was becoming an increasing problem for the elderly. He said: ‘Energy prices are continuing to rise leaving elderly people with less cash and a grim choice of whether they should turn the heating on or have a hot meal.

‘It is a worry that more people will become fuel poor in the future and we need to try and stop this from happening by offering them assistance and urging energy companies to reduce their bills.’

The £4million payout comes less than two weeks after Centrica put out its annual report, detailing eye-watering pay and perks for the Centrica boss, including a discount of almost £700 on his annual energy bill – granted because he sits on the company’s board.

Even though his basic salary fell from £2million in 2010 to £1.3million, he benefited from numerous share plans pushing his 2011 earnings to £10million. His basic pay included £63,000 for a car and driver as well as £279,000 in lieu of pension payments.

A further £101,250 was paid into his pension pot, and he received shares in the company worth £848,000 at today’s price, although he won’t be able to cash those in for three years.

Last night a Centrica spokesman defended the latest pay-out, saying the awards were ‘dependent on the achievement of demanding performance targets’ and also reflected ‘strong business growth in the last three years’.
He added: ‘Over that period, Centrica has generated post-tax profits of nearly £4billion, invested over £7billion in securing energy supplies and paid around £2billion in tax.’ Earlier this year, the Daily Mail revealed that the number of pensioners dying from hypothermia has nearly doubled in five years, a period when a succession of cold winters has been coupled with drastic rises in energy bills.

Official figures showed that 1,876 patients were treated in hospital for hypothermia in 2010/11, up from 950 in 2006/07.

Three-quarters of victims were pensioners, with cases soaring among the over-60s more than any other age group.

11/04/2012 - Dailymail.co.uk

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