Energy

It is a busy day on the economic front, with new inflation figures (which are expected to show an increase) to be released at 9.30am and Ed Davey, the energy secretary, to address the House about further allegations (published in the Guardian this time) that the wholesale price of gas has been fixed by traders. The claims were made by a whistleblower, Seth Freedman, who used to work at ICIS Heren, an agency that reports on gas prices. The Financial Services Authority and the energy regulator, Ofgem, have both swung into action to investigate Freedman’s allegations. It is only natural that the government would state its response to the House and

David Cameron’s announcement in the House of Commons on Wednesday – that he would force energy companies to give people the lowest tariff – caused a stir. The Downing Street comms machine has been trying to clarify the new policy ever since and we’re only just starting to see a clear idea taking shape. So what are we to make of it? Well, there is almost no competition in the energy market. There are only six big companies, and those are regulated within an inch of their lives. So with no proper competition, you could make the case that government has a role to make sure that customers are properly

David Cameron has arrived in Brussels for a meeting of the European Council, and has offered further helpful clarification of what exactly he means to do about energy bills. The Prime Minister said: ‘I want to be on the side of hard-pressed, hard-working families who often struggle to pay energy bills. That’s what I said in the House of Commons yesterday. We’re going to use the forthcoming legislation, the energy bill, coming up this year so that we make sure, we ensure that customers get the lowest tariffs. That’s what we’re going to do.’ This is still different to what the Prime Minister said in the Commons yesterday. Privately, the

Though it was never going to make the earth move, Ed Davey’s speech to the Liberal Democrat conference highlighted the party’s push for differentiation on the green agenda. The Energy and Climate Change Secretary was clear that installing Owen Paterson, as the new Environment Secretary, would not stop the Lib Dems fighting for a green future and a green economy. ‘Our Coalition agreement to clear up Britain’s mess, wasn’t an agreement to turn the clock back. For business as usual. To rekindle Thatcherism – or Blair-Brown. It was for a fairer, greener Britain – and we must fight for that. Earlier today, I moved the motion to pledge this party’s

Ed Davey has managed to win his first major battle as Energy Secretary – against the might of the Treasury, no less. James blogged earlier in the week that the battle between Lib Dem and Tory on cutting subsidies for onshore wind generation would be a test of how well the coalition is actually working, and this morning’s report in the Financial Times that George Osborne and Davey have managed to find a compromise is an illustration of that partnership in action. The newspaper reports that the dispute became so heated that Nick Clegg and David Cameron intervened to hammer down a final agreement. In the blue corner, Osborne was concerned not just by

The Government takes a lot of stick for blaming the weather when there are queues at airports or lacklustre growth figures. Now the European Union is blaming a ‘colder winter’, as well as ‘economic recovery in many countries’, for emissions in 2010 being 111 million tonnes of CO2-equivalent higher – about 2.4 per cent –than they were in 2009. They are insistent that ‘the increase could have been even higher without the fast expansion of renewable energy. ’ Looking at the record of emissions in the European Union and the United States though, it is clear there is a deeper problem. Even ignoring emissions exports — the amount emitted in

Bjorn Lomborg’s article on why Germany is cutting back on its support for solar power is well worth reading and has clear implication for this country’s debate about energy policy. As Lomborg argues: ‘there is a fundamental problem with subsidizing inefficient green technology: it is affordable only if it is done in tiny, tokenistic amounts. Using the government’s generous subsidies, Germans installed 7.5 gigawatts of photovoltaic (PV) capacity last year, more than double what the government had deemed “acceptable.” It is estimated that this increase alone will lead to a $260 hike in the average consumer’s annual power bill.’ At a time when living standards are being squeezed, these increases

Shale, what is it good for? How about fuelling Britain’s energy needs for decades to come? The Sunday Times reported yesterday (£) that the reservoir of shale gas discovered in the North West could — depending on how it extracts — supply us with energy for up to 70 years. And we devoted our leader in this week’s magazine to the wider potential of this resource. Here is that leader, for CoffeeHousers: Economies of shale, The Spectator, 11 February 2012 The weather conditions of the past week could not have been better conceived to show up the inadequacies of Britain’s — and the rest of Europe’s — energy policy. A vast anticyclone extending

Did we need to replace Chris Huhne at all? Nigel Lawson, a former editor of The Spectator (amongst other things), has an intriguing idea in a letter to today’s FT: just break up the Department for Energy and Climate Change. It has done nothing to encourage the development of shale gas, which — as we argue in a leader in tomorrow’s Spectator — could keep Britain in energy for the next 100 years without the need to build another windmill. Lord Lawson, a former energy secretary, says that Ed Davey: ‘…has the opportunity to enter the history books as the only minister to use his position to abolish it for

The economist Dieter Helm is one of the few policy thinkers respected on both sides of the coalition. Oliver Letwin is a long-standing friend of his and Clegg’s office views him as one of the best economic brains in the country. All of which makes Helm’s attack on Chris Huhne’s energy policies in The Times today as interesting as the anti-wind farm letter signed by a 101 Tory MPs. Helm argues that the policy of huge subsidies for renewables is a mistake and that shale gas is a game-changer. Helm writes that, while renewables have a role to play, ‘Coal burning is not going to go away because of wind.