Energy

Grey launch day for Green Deal

The Tories in opposition were very keen on their ‘Green Deal’ for making existing housing stock energy efficient. It formed the cornerstone of their pledge when the Coalition formed to be the ‘greenest government ever’. It had its big full launch today, with new loans available for homeowners to insulate their properties and pay back the money through their energy bills. The only problem is that the Green Deal isn’t quite the big all-singing all-dancing deal the government envisaged. The idea was that big businesses would lead the way in providing the scheme, but one of the leading retailers who expressed initial interest in the scheme, Marks and Spencer, isn’t

No Country for Green Men – Spectator Blogs

This week’s Think Scotland column takes a gander, just for once, at the Scottish Green party. Patrick Harvie’s party is in favour of Scottish independence for reasons that, frankly, seem pretty damn unconvincing. I suspect that the Greens, like those parts of the far-left that also favour independence, are liable to be desperately disappointed by life in an independent Scotland and that they will come to realise that it is not much better than their present miserable existence within the United Kingdom. Harvie, of course, rejects the label “nationalist”. He is, he insists, no such thing and you don’t need to be a nationalist to favour independence. Well, maybe not.

Osborne to back fracking and 30 new gas power stations

Coalition tensions over energy won’t relax with George Osborne’s gas strategy, which he will launch alongside the Autumn Statement tomorrow. The Financial Times reports that the Chancellor’s strategy will approve as many as 30 gas-fired power stations and – in a move that will delight those in his own party – a regulatory regime for shale gas exploitation. Fraser extolled the virtues of shale gas in his Telegraph column in September, describing it as ‘the greatest single opportunity’ facing the government, with the potential to transform energy supply. But Energy Secretary Ed Davey is less enthusiastic, arguing in May that Tory support for shale gas exploitation – known as fracking

The politics of energy

When David Cameron made his surprise announcement about forcing energy companies to offer customers their cheapest deal, he added, as an afterthought, that the leader of the opposition had missed the chance to be on the side of the consumer when he was energy secretary. I would be surprised if the average voter knows that Miliband was energy secretary; but, from Cameron’s perspective, the line of attack makes sense: energy prices and the cost of living are vital political issues for this government. The government, then, will be thrilled that Energy Secretary Ed Davey’s plans (which appear to be based largely on Ofgem’s recent ideas about simplifying tariffs: Davey will

The energy sector’s Libor-style scandal

As David reported earlier, today’s Guardian carries allegations of price-fixing in the energy markets. The paper has an account by Seth Freedman, who worked as a price reporter at ICIS Heren, detailing how he observed suspicious trades that looked like attempts to manipulate the daily index price. Based on Freedman’s account, the alleged manipulation looks very much like that employed by City traders in the recently-exposed Libor scandal. Ironic, then, that the ‘suspicious’ trades Freedman observed came on the same day as Martin Wheatley published his review of Libor for the Treasury: Friday 28 September. Even after bankers had resigned and as new regulations for that sector were being planned,

Tuition fees push inflation back up to 2.7%

After falling to 2.2 per cent in September, inflation — as measured by the Consumer Prices Index — rose to 2.7 per cent in October. On the Retail Prices Index, inflation rose from 2.6 per cent to 3.2 per cent. The main cause of the rise is the government’s changes to university tuition fees, which put the maximum annual fee up to £9,000. Today’s figures are the first to include the effects of the policy — with the education index 19.7 per cent higher than last year. But food prices were up too — by 0.5 per cent on last month and 3.3 per cent on last year. The good

Government responds well to energy price fixing claims

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

Politicians shouldn’t meddle with energy prices

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

Energy bills row: Cameron clarifies his surprise announcement

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

Isabel Hardman

How David Cameron fluffed a key cost of living announcement on energy

The Conservatives are worried that voters are deserting them over the rising cost of living, yet their leader has managed to fluff an announcement designed to remedy that problem. Yesterday at Prime Minister’s Questions, David Cameron surprised the whole chamber and the department concerned by announcing a brand new energy policy. In response to a question from Labour’s Chris Williamson about what the government was doing to help people reduce their energy bills, Cameron said: ‘We have encouraged people to switch, which is one of the best ways to get energy bills down. I can announce, which I am sure the honourable gentleman will welcome, that we will be legislating

Lib Dem conference: Ed Davey says he’s ‘not for turning’ on a green future

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

Alex Salmond’s wind farm delusion

Last year, in an interview with the Today programme, the chief executive of National Grid told the show’s no doubt stunned listeners that they would have to get used to not having electricity as and when they wanted it. That here in the developed world we should be wondering whether the lights will be going out in a few years time, whether our children will go to bed in the cold or whether we will spend our evenings shivering around log fires is rather amazing. That our political leaders have achieved this — if achieved is the right word — in the face of the shale gas revolution with its

The blue vs yellow fight to make green policy

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 Treasury sides with the consumer over climate policy

Tim Yeo is now posing as a friend of the consumer. Launching the latest report from the Energy and Climate Change Committee this morning, he attacked the Treasury for ‘refusing to back new contracts to deliver investment in nuclear, wind, wave and carbon capture and storage’. The report argues that could ‘impose unnecessary costs on consumers’. The basic logic of his claim is this: investments are more expensive when they are riskier. Investors expect to be compensated for the risks being taken with their money. If the Government offers guarantees that reduce the amount of risk energy companies run by investing in expensive sources of energy like offshore wind, then those firms

Davey takes aim at the winter fuel payment

On Monday, David Cameron reiterated his opposition to scrapping the winter fuel payment as a universal benefit. During his speech on welfare, the Prime Minister said: ‘There is also a debate about some of the extra benefits that pensioners can receive – and whether they should be means-tested. On this I want to be very clear: two years ago I made a promise to the elderly of this country and I am keeping it.’ Even though means-testing winter fuel payments might be off the table, I understand that work is still going on within Whitehall to alter the benefit. This time it’s not in the Work and Pensions department, which

The deeper problem behind Europe’s rising carbon emissions

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

Iran and oil are still on the agenda

For all the talk about Greece and France and the Eurozone, it’s telling just how much our politicians are focusing on Iran. Indeed, some of the most concrete political settlements of the past few days have concerned that turbulent state. On Friday, the US Congress approved a Bill which included the blunt reminder that, ‘It shall be the policy of the United States to take all necessary measures, including military action if required, to prevent Iran from threatening the United States, its allies or Iran’s neighbours with a nuclear weapon.’ And the G8 subsequently put out a statement about oil reserves that clearly had Iran in mind. ‘Looking ahead to

The Chinese lantern is dimming

Does anyone believe Chinese GDP figures? Officially, the economy is roaring at 9 per cent a year. But thanks to WikiLeaks we know that Chinese Politburo member Li Keqiang thinks that the official GDP data is ‘for reference only’ — and that if you want to know how fast China is growing you should look at electricity consumption, rail cargo volume and bank lending etc. So today’s announcement of China’s electricity consumption figures for April showing a year-on-year growth of 3.7 per cent is quite significant. This is growth beyond George Osborne’s wildest dreams, but by recent Chinese standards is pretty paltry. Last year China’s electricity consumption grew 12 per

A welcome attempt to fix the broken energy market

Back in October, Ofgem produced a report exposing the failure of the UK’s energy market. It showed that the supplier’s profit margin on the average fuel bill had shot up from £15 to £125 in just four months. As I said at the time, ‘This wouldn’t be possible in a market that was working correctly. If customers were shopping around for the best deal, suppliers would have to undercut each other – and there’s plenty of room for them to reduce prices while still turning a profit (£125 of room, in fact). But Ofgem’s figures show this isn’t happening.’ And why isn’t it happening? Because, in Ofgem’s words, ‘Many consumers

Rising gas prices hurt Obama

Barack Obama’s re-election has been looking more and more likely in recent weeks. His approval rating has risen fairly steadily, economic forecasts have improved and he’s opened a nice lead in head-to-head polling against Mitt Romney, as the Republican primaries have taken their toll on his most likely opponent. But the latest polls show things moving dramatically in the other direction, for the first time since early October. A Washington Post-ABC poll conducted last week shows Obama’s approval rating dropping from a healthy 50 per cent last month to 46 per cent now. It also shows Romney leading Obama 49 to 47, compared to 51-45 to Obama last month. These