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'Let renewables fight it out for subsidies'

By Western Morning News  |  Posted: October 08, 2013

Comments (6)

A Westcountry MP who was yesterday appointed minister for rural affairs wants wind and solar energy subsidies slashed to curb spiralling household bills.

George Eustice, Conservative MP for Camborne and Redruth, told the Western Morning News that developers of otherwise uneconomic "green" technology should "fight one another" to get financial support.

The Taxpayers' Alliance has just claimed every British household will pay an average of more than £400 in higher bills to help otherwise uneconomic carbon-free technology meet targets by 2020.

Mr Eustice was an adviser to Number 10 on energy and climate change issues before yesterday being named a junior minister in the Department for the Environment, Food and Rural Affairs in the reshuffle.

His comments come amid Labour leader Ed Miliband's plan to freeze energy bills and Tory and Lib Dem Cabinet ministers warring over plans to cut "green" subsidies.

Speaking to the WMN yesterday before his appointment, he said: "There is an argument that the level of subsidy paid for wind and solar is still too high and this is being passed on to electricity bills.

"We need to replace the current subsidy system with a highly competitive 'Dutch auction' or tender process where renewable energy developers fight one another for the right to install new capacity at the cheapest possible price."

He argues his proposal would address the issue of varying costs and levels of efficiency between the different technologies.

At present, the so-called Renewable Obligation guarantees a subsidy based on the technology – be it offshore wind turbines, onshore wind farms, biomass plants, landfill gas sites or hydro power plants – rather than how effective an individual scheme is.

Mr Miliband last week promised a 20-month energy price freeze should Labour win the general election, saving the typical household £120 between May 2015 and January 2017. The Opposition leader said the freeze would allow time to cut bills long-term and stick to "green" power targets too. But critics argue it will be impossible as subsidies are at the root of the problem.

Tory ministers attacked Labour's move as a "gimmick" and claimed Mr Miliband was taking his party "back to the 1970s" by reverting to left-wing interventionism in the economy. They have also blamed Mr Miliband's "green" policies when he was Labour's Energy Secretary for helping to force up bills.

Mr Eustice told the WMN the Labour plan was flawed as energy companies could hike bills before the freeze comes into force.

He said: "Ed Miliband's proposal was not thought through and is the wrong way to tackle a genuine problem. It could drive up prices in the short term and lead to energy companies gaming the system. The right response is to make the market more transparent and competitive."

Subsidies are paid for by consumers and businesses in their bills and passed to green energy generators. A Taxpayers' Alliance analysis shows the total subsidy will be nearly £22 billion by 2020.

In May, Mr Eustice was named among an eight-strong team of Conservatives developing policy within No 10, and was charged with advising on energy and climate change. Supportive of wave power, the former farmer has raised concern over the effectiveness and visual impact of wind farms, and has called for a planning clampdown to block the march of turbines and large solar farms. Both technologies have caused deep divisions in the Westcountry.

His stance brings him in line with his new boss, Tory Environment Secretary Owen Paterson, an outspoken critic of wind farms who has clashed with Lib Dem Energy Secretary Ed Davey over their worth. Chancellor George Osborne reportedly wants to use his autumn budget statement to raid the power giants' energy tariffs by slashing subsidies. But he faces opposition from Mr Davey, who has argued there was "no justification" for neglecting carbon reduction targets.

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  • pjerry  |  October 09 2013, 12:32AM

    Go Eustice Go!

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  • Trecurnow  |  October 08 2013, 2:06PM

    Farmers I have spoken to recently consider solar panels and wind turbines as "diversification" along with caravan and camp sites and other forms of holiday accommodation. Leave the farming to someone else!

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  • TWINSCREW  |  October 08 2013, 1:05PM

    All businesses should have to stand on their own two feet, by that I mean, 1, design a product you think there is a market for, 2, offer the product to the public at your expense, 3, see who takes up your offer. If there is demand you will succeed and make money, if not you will go under, why should the green suppliers be any different, we have been conned.

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  • letigre  |  October 08 2013, 12:18PM

    Blasphemy Dantwo! Everybody knows that manmade CO2 is the ONLY thing causing climate change/global warming/global cooling or whatever it is called these days. The oceans, water vapour, clouds, naturally occurring CO2 (96% of CO2 in the atmosphere), aerosols, other greenhouse gasses and the sun have no effect whatsoever. The only solution to this impending crisis to for Cornwall to cover itself with wind turbines and solar panels or we'll be doomed, doomed I tell you. FITs were only ever meant to be temporary anyway so this day has been fairly inevitable. Question is, will the Tories act sooner rather than later. Come on DEFRA, time to stand up for rural communities we're fed up of being under siege.

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  • Cowpat  |  October 08 2013, 11:25AM

    Good start by Eustace - we should not be subsidising uneconomic renewable schemes that are driving up energy prices and bills when many are teetering on the brink of fuel poverty. And then there is the environmental damage that wind farms and solar farms cause. On-shore wind farms kill protected, and often threatened, birds and bats, ruin aesthetically pleasing landscapes and spoil neighbouring folks' lives. Off-shore wind farms destroy the seabed and its marine ecosystem, and probably kill many protected sea and migratory birds - out of sight and out of mind. Meanwhile solar farms are taking up valuable agricultural land and displacing nationally dwindling farmland flora and fauna. Put them on brownfield sites and roofs instead, and above all ensure that they are economically viable without taxpayer subsidy.

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  • Dantwo  |  October 08 2013, 11:08AM

    Carbon reduction targets are a figure plucked from the air by the European Union and imposed on us. The UK contributes less than 2% of the world's CO2 - that's if you believe that man-made CO2 is causing 'global warming' - oops 'climate change'. 'Global warming' has now been ditched as it has been shown the planet is actually cooling at the moment. Meanwhile to meet these ridiculous targets set by the EU this country is now, believe it or not, importing wood from the USA to burn in what was once was Europe's biggest power station, Drax. The sooner we ditch the feed-in-tariff the better. People are already suffering finacially as a result of this 'green' charge on our electricity bills. And our manufacting, or what's left of it, cannot compete with the likes of China which is still building coal-fired power stations as fast as it can. Historians will look back and say this country (courtesy of Europe) had gone MAD. Good luck to Geo Eustice if he can do anything about it.

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