The Renewable Energy Centre comments on how the Energy White Paper released on the 23rd May will affect UK consumers and businesses.
Last week the Department of Trade and Industries Secretary Alistair Darling released the 2007 Energy White paper, setting out the Government's vision for renewable and nuclear power for the future, focusing on the two main challenges for the government at this time.
The main issue addressed was the question of maintaining stable, secure and affordable energy supply as the UK is becoming increasingly dependent on imported gas and oil. Global demand is accelerating and Darling stated that if action is not taken on finding an alternative source of fuel soon, in 10 to 15 years the gap between demand and supply will become alarmingly small.
The threat of climate change due to carbon emissions was also an important part of the paper which particularly highlighted the significance of the energy efficiency of UK buildings, both commercial and residential.
The Renewable Energy Centre commented that the extension on the current Emissions Trading Scheme for businesses was an important step forward. The new UK Carbon Reduction Commitment will extend the targets from industrial plants now to the largest companies in the country, including supermarkets, banks and hotels. Through this commitment the Government aims to raise the renewable share to 10% by 2010, and to 20% by 2020.
There is also increasing pressure on energy companies themselves to act in a more environmentally responsible manner. The Renewables Obligation states that power suppliers must buy a certain proportion of their energy from renewable sources. The rate is currently 7.9 per cent but will rise annually to 10.4 per cent in 2010.
The Renewable Energy Centre also supported the proposed reform on the current Renewables Obligation to incentivise investment in capital intensive and emerging technologies to ensure a range of renewable sources develop. Each energy source will now be 'banded' and a MWh of electricity generated by a particular technology shall be awarded more than one (or less than one) Renewables Obligation Certificate.
The paper also touched upon the important subject of consumers and one of the main proposals was the introduction of a real time 'Smart Meter' aimed to give homeowners greater control over their usage of gas and electricity. Although these are predicted to have a dramatic effect in reducing energy consumption in households, it is estimated that they will take up to 10 years to install and cost around £8billion, a cost which many argue will eventually fall to the consumer rather than the energy supplier.
The Renewable Energy Centre stated it was also disappointed with the lack of improved grants or subsidies for people using micro-generation in their homes and urged the government to make local government funding available so that zero carbon homes qualify for a significant rebate on Council Tax or alternatively exemption from stamp duty.
Richard Simmons, Director of The Renewable Energy Centre stated "The White Paper was a combination of good intentions and missed opportunities. Whilst the intention to triple the contribution from renewables by 2015 is positive news the incentives are weak.
He continued "It is our view that the technologies to achieve the targets are already available, that the challenge is their implementation. As before, it will be a combination of eco-enthusiasts and energy producers striving to meet their renewables obligations driving forwards renewables growth whilst the government consults, revises its targets and wrings its hands".
It is clear from the paper that although renewables are set to play an increasing role the government will not be relying on them to fill the energy gap and therefore is likely to invest funds into a vast nuclear programme despite the opportunity to put a truly radical programme of renewable development in place.
Most nuclear power stations are set to close over the next 10 to 20 years at a time when demand for electricity will go up due to economic growth. The Paper concludes it would be in public interest for energy companies to invest in nuclear power, and a public consultation on nuclear power stations will run until October 2007.
The Renewable Energy Centre commented that there was ultimately no real consensus on the two main issues of climate change and fuel supply addressed in the 2007 energy white paper. What the Government has done is to illustrate that they have identified the current problems and actions necessary to avoid a future catastrophe; however the real test will be how they implement these plans.
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