Renewables subsidies not to blame for hike in energy prices

In anticipation of the opposition day debate on Energy Market Reform today, the REA has analysed Ofgem and DECC data that shows support schemes such as feed-in tariffs and the Renewables Obligation have contributed just £4 to energy bill increases.

Ofgem data shows average dual-fuel energy bills have energy bills have risen by £205 in the past two years.

The data suggests factors other than renewables subsidies are responsible for 98% of the price hike in energy bills over the same period.

The REA claims that the recently announced new round of price increases of around £80 means that renewables will account for an even smaller proportion of energy bill rises.

REA chief executive Gaynor Hartnell said: “The role of renewables in increasing energy bills is often greatly exaggerated. The figures show it’s our reliance on fossil fuels that is costing us dear. Not only is it more affordable than people think to go renewable, but the public understands that our future national security and prosperity depend on it.”

The Commons debate today focusses on reforming the electricity market to improve competition in the electricity sector. However, the REA say it is crucial that the role of renewable energy is better recognised in order to help improve consumer choice and competition.

Hartnell said: “Renewables make it possible for people and communities to supply themselves with heat or power.

“This introduces a whole new level of choice and competition into the energy markets. We’d like to see politicians from all parties fully grasp that potential. Support for renewables can drive a much more diverse and competitive market, not just green energy.” 

The REA recently set out its 10 Energy Bill demands in a policy briefing. These include specific measures to make it easier for homes, businesses and communities to invest in generating their own power. 

Conor McGlone