DECC is a hostage of the Treasury, says energy committee chief

The head of the Parliamentary committee that holds DECC to account has launched a scathing attack on the Department which he says is held captive by the treasury and lacks a coherent strategy.

Speaking at an energy storage event hosted by the Renewable Energy Association (REA) in London, Energy and Climate Change Committee chief Angus MacNeil criticised the “pennywise and pound-foolish” cost-cutting approach taken by DECC in recent months.

“Reason does not work with this Government,” said MacNeil. “They have a mantra, an obsession with balancing the books. They are like a farmer who thinks that seeds in the springtime are an unnecessary extravagance.

“They need to introduce an element of time into their cost considerations. The problem is that they are looking after people’s bills today and not thinking about people’s bills tomorrow. If we don’t invest today we will see higher prices tomorrow.”

MacNeil cited a recent Carbon Brief Freedom of Information request which uncovered DECC emails that indicated the Department’s expectation of energy bills to be lower than previously projected due to lower wholesale fuel costs caused in part by the impacts of renewable energy.

MacNeil continued: “The pursuit of two parts of the energy trilemma – cost and security – have become something of a ministerial mantra. There is constant talk of keeping bills down and keeping the lights on. DECC are pennywise and pound-foolish for today. They see all investment today as costs and that’s a huge problem.

“Amber Rudd said told Committee that this is a joined up Government, but that’s part of the problem. They are too closely joined with the treasury. DECC is a hostage of the treasury and appears to be suffering a severe case of Stockholm syndrome.”

Government response

In the past six months, the Government has made 13 different changes to green policy, including subsidy cuts for onshore wind and solar panelscuts to energy efficiency programmes and the end of carbon capture funding.

Prime Minister David Cameron last week defended those decisions in Parliament, echoing Energy Secretary Amber Rudd and Under-Secretary Lord Nick Bourne by saying that such changes were necessary to curb consumers’ energy bills and ensure a balanced supply of energy. Cameron also dismissed the criticism these changes had received from experts as “complete and utter nonsense”.

However, MacNeil expressed some hope that the changes could be reversed if they proved as detrimental to the renewables industry as experts predict.

He said: “The Government has been extraordinarily brave in sticking with its plans to cuts subsidies in the face of strong opposition from industry. If the industry proves to be right, we anticipate the government will review those decisions with the appropriate urgency. Having said that, I wouldn’t hold your breath, because there’s no man with a plan in DECC.”

Mutually beneficial

Concluding his speech on a note of optimism, MacNeil suggested that the nascent energy storage industry could provide a much-needed boost for both the renewables industry and the Government’s stated priorities.

“The outlook for renewables goes hand-in-hand with storage,” he said. “My committee and I are aware that storage could help secure supply and affordability, if that is indeed the Government’s aim, and we shall be seeking to ensure that they are aware of their own rhetoric in the months and years ahead.”

MacNeil added that DECC will be launching a consultation in the spring, asking for responses on how to bolster investment in energy storage. At present, the UK has about 24MW of storage capacity, but the REA has predicted that systems could soon be financially viable, leading to an installation explosion by 2020.

Brad Allen

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