Time to stand up to the Tory war on green investment

Photo: Monty Rakusen/Science Photo Library
Chimney at power station

By Christina Prentice

Cameron’s attempt to regain the political agenda over the cost of living crisis by pledging to “roll back green charges” on energy bills was not only cynical but damaging and should be actively opposed.

Cynical because Cameron knows that green and social investment to insulate the leaky homes of older people and people in fuel poverty are not the main drivers of energy bill hikes – gas prices and super profits are. In the last eight years, energy bills have risen by £520.  The Committee on Climate Change says that the vast majority of this has been because of the rising price of gas.  Low carbon technologies have added just £30 in that time.


Damaging because his intervention risks stamping out any residual confidence in Britain’s green industries. Urgently needed investment in large scale renewables such as offshore wind will effectively be on hold until there is more certainty – seriously setting back Britain’s chances of meeting its vital climate change responsibilities and leaving households and the economy increasingly exposed to soaring international gas prices. Britain stands to lose out too in the fast growing £3.5 trillion global market in clean energy goods and services.

The Tories must not be allowed to kill off green investment. Nor let the power giants, sitting on billions in profits, shirk their responsibility for renewing Britain’s aging and polluting electricity system.

Government divisions are now between George Osborne, who wants to use the opportunity to slash green investment, and the Liberal Democrats who, under pressure from the legacy of their ‘green’ political platform, want to maintain current green commitments but transfer the costs onto general taxation. Expect an announcement in Osborne’s Autumn Statement on December 5th. The energy giants would be pleased with either outcome – protecting their profits and allowing dirty business as usual.

But the Tory anti-green agenda goes beyond cynical attacks on current investment commitments for short term political advantage. The Tories have fought every new carbon reduction commitment made in line with the Climate Change Act. They have fought every new regulation to support renewables. And just days after Cameron’s ‘rolling back green charges’ pledge, the Con-Dem Coalition narrowly defeated long fought-for plans to shift to a carbon-pollution free electricity system by 2030 in a vote in Parliament.

The antipathy is not just about playing to the tea party wing for whom being anti-green has become an article of faith. Or to chime with the relentless anti-wind farm campaigns of the Sun, the Daily Mail, the Daily Express etc. It is about protecting some of the most concentrated and well-connected sections of capital in the world – the fossil fuel and nuclear industries – against much smaller, dispersed, newer renewables and insulation industries. Over £100 billion investment is needed over the next decade to renew Britain’s aging and polluting electricity system following decades of underinvestment by the privatised energy companies which preferred to extract super-profits. With this scale of money at stake, Cameron and Osborne know which side they’re on.

Like Thatcher before them, Cameron and Osborne have needed little persuasion to open the cheque book for North Sea oil and gas and nuclear power, offering billions in tax breaks, loan guarantees and regulatory ‘flexibility’.

new dash for gas has received full political backing. Osborne has announced that he wants Britain to become a new hub for gas. Gas industry employees are being seconded to the Department of Energy and Climate Change to draft new subsidy policies for gas. And the myth of a boom in jobs and cheap gas from fracking is providing a handy bulwark against the meaningful rapid shift to clean energy we need.

In the case of new nuclear power, the new deal announced guarantees payments for electricity at twice the current price of power for 35 years. It is hard to think of a worse deal. Nuclear power is one of the only technologies that get more expensive over time to cover the cost of its inherent dangers, particularly following the Fukushima disaster (which is still not under control). Meanwhile renewable costs are plummeting. Both wind and solar power are expected to be cheaper than nuclear power years before the new nuclear reactor at Hinkley Point is switched on, even assuming it is not beset by the years of delays faced by similar reactor designs being built in France and Finland. Time is running out for a shift to low carbon energy. Renewable power is much faster to build than dangerous nuclear power.

Left unchallenged, Cameron, Osborne and the tea-party wing will back the old fossil fuel and nuclear vested interests and ensure hard-pressed consumers, not profit margins, are tapped for the money. They will champion the ‘free market’ whilst stacking the cards against cutting edge clean energy. Political leaders and energy companies across Europe will be looking to see the outcome of the fight in Britain as they too embark on electricity market restructuring and renewal.

The key questions now are: what should Britain’s outdated polluting electricity system replaced with? And who will pay for it?

The IPCC could not have made it clearer – we are five minutes to midnight on the climate change clock. As the international climate talks take place in Warsaw, the cost of allowing temperatures to rise could not be clearer as we witness the devastation wreaked in the Philippines by Typhoon Haiyan (Yolanda). The World Meteorological Association report that this is one of the most powerful tropical cyclones ever recorded anywhere and warn that the impact of such storms is expected to become increasingly intense with climate change.

Business as usual – handing out guaranteed profits to friends in the fossil fuel and nuclear and industries will not cut it. Only a decisive improvement in energy efficiency – reducing the need for energy consumption – and a shift to clean energy will offer us a crucial lifeline to the lower carbon economy that can protect us from worst effects of climate change and keep energy bills under control.

If Britain and Europe are actually to make the shift to a low carbon economy, leaders will either need to demonstrate a strong long-term cross-party consensus for regulations favouring clean energy over dirty. Or they will need to go a step further and require big capital, sitting on £500 billion, to invest or impose windfall taxes and make the investments directly.