The political right has been fighting back against a variety of green measures this week. I’ve heard two people interviewed that have dropped into quite unrelated interviews that energy prices are high because of green measures or the poorly paid are poor due to high energy prices due to greenery. This is untrue. In 2011 my gas price went up by 30%. This massive increase had nothing to do with the FIT or green deal or anything else. It was caused by a huge increase in the wholesale cost of gas which increasingly we have to import. The poor are poor because they are unemployed or in low paid jobs, the remedies are obvious people need work. Giving the low paid a living wage would not only allow them to pay their energy bills, it would put money back in the economy, increase tax revenue and cut government spending since the low paid have their wages subsidised by the state through tax credits. Yes that’s right many of the worlds biggest multinationals can come here and pay low wages subsidised by the state.
Anyway back to energy bills, DECC has released analysis showing currently green measures add 9% to the average bill. It much more difficult to explain that green measures will add to bills over the next 17 years, but they would have been higher without them. DECC hasn’t made a good job of this. I will have a go. Essentially the cost of the measure be it insulation or solar PV is fixed at the time of installation. The cost you pay to heat your house say using a gas boiler is not fixed its constantly rising due to the cost of gas rising. Therefore within reason* some measures that will appear to have a poor pay back may be more economic than you would think. The full document can be seen here . Some of the document is implausible, for example DECC think energy prices are going to rise 6% by 2020. The expected increase this year is at least that.
* it has to be said many of the green deal measures identified in the radio 4 programme “You and yours” had such small savings payback looked unlikely, or at least very slow.
Neil