Siobhan Kennedy, Politics and Business Correspondent
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Householders will be warned today to expect five years of higher home energy bills to pay for a green power revolution.
John Hutton, the Business Secretary, will outline plans for a massive shift away from fossil fuels to wind, solar and tidal power, but will add that the change comes at a price. “We think there will be a cost,” he told The Times yesterday.
The plan, which he calls the biggest shake-up in Britain's power generation since the Industrial Revolution, requires £100 billion of new investment but would lead to five years of higher gas and electricity bills from about 2015, he said.
Homeowners will be given financial incentives to fit their roofs with solar panels and there will be ambitious targets to increase their use from 90,000 today to seven million within the next 12 years. The plan also envisages a 90 per cent increase in the use of ground and air-source heat pumps that provide “free” heat by tapping the warmth in the air or the earth.
Mr Hutton will also outline a “feed-in tariff” allowing homes that generate surplus electricity to sell it to the national grid as an incentive to switch.
The news comes a day after the chiefs of the big six energy companies gave warning that energy bills, which have already risen more than 15 per cent this year, would rise again within the next few months because of the rising price of oil.
Mr Hutton said the renewable cost would be “relatively modest”, set against the current increases in the prices of coal, oil and gas and the scale would depend on movements in world oil prices. But he said that it was a necessary price to pay if Britain was serious about addressing climate change and switching to green technology.
“At the end of the day, we as consumers, we pay for the product. That's how it is,” he said.
Under the green energy programme, more than a third of Britain's electricity would be generated from wind power by 2020 by 3,500 onshore wind turbines - about 2,000 are currently operational - and 7,000 offshore. This should help Britain to meet its EU target of generating 15 per cent of its energy from renewables by 2020.
Another big growth area will be bio-energy, where about 6 per cent of electricity will be generated from burning wood, straw and energy crops. Large areas of woodland will be used and sewage works will be encouraged to supply biogas. The plan also calls for a steep increase in the use of biofuels to run aircraft and trains.
“The scale of it is unprecedented in the history of our country since the Industrial Revolution,” Mr Hutton said, adding that he wanted carbon to be taken out of the power system altogether by 2050. He said the plan would beside with the Government's strategy to increase the amount of energy generated by nuclear power from today's 20 per cent rate.
The biggest challenge, he said, would be attracting companies to make the cumulative £100 billion investment and beating competition from other European countries rushing to do the same thing. If successful, it would lead to the creation of 160,000 British jobs. “We're in a race for this investment,” he said.
He will also announce today an agreement with Ofgem, the energy regulator, to give priority to renewable projects gaining access to the grid. He has also signed a deal with the MoD to speed up the delivery of offshore wind farms without interfering with radar.
“There is no way of making these changes without there being some impact on the natural environment. I'm afraid some people will look out of their windows and see a wind turbine,” he said. “People need to wake up. We either make these changes or we don't. What we don't have is this magic third option of just carrying on as we are.”
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Ben -
For at least forty years, hundreds of thousands of houses (maybe millons) in the USA have been reliably heated in winter AND cooled in summer by heat pumps, using ground heat and/or air heat. The pump is electrically driven, but three times (or more) heat energy is produced by the system.
Peter Lloyd, BLACKER HILL, South Yorkshire
"The plan also envisages a 90 per cent increase in the use of ground and air-source heat pumps that provide free heat by tapping the warmth in the air or the earth."
Someone needs to explain the laws of thermodynamics to these people!
Ben, Peel, iom
The UK Government Energy Review (2006) gave the cost
of Offshorewind as £82/MWH and nuclear as £38/MWH.
Where nuclear power is politically unacceptable it is defensible to go for the more expensive alternative. However the British Goverment has recommended nuclear .Why then choose to pay more?
stephen bull, fontes, france
Once more 10 Clowning street leads us into a money loosing scheme. When will we ever get some politicians with brains, no matter how you spell it out for them they still insist on wasting money on ill thought out schemes. There must be a competion in Parliament to see who can waste the most money.
David, Helsinki, Finland
Wind power isn't the way to a renewable future; not while conventional alternatives need to step in every time the wind drops. Solar power could do a lot more to help, but not while it costs around £7000 to install a system capable of providing just 60% of an average family's hot water supply.
Howard Goodall, Stoke-on-Trent, United Kingdom
Well now! I wonder where the New Labour Party will be looking to get their funds for the next General Election?
Dido Bendigo, Lochgilphead, Argyll
About time too!
Several years ago the 22,000 m2 Waterloo Station train shed roof was refurbished and the old glass roof replaced.
Half the roof ( 11,000m2 ) had South facing glass, and the possibility of laminated glass with photo-voltaic cells considered.
Option was turned down as too expensive!
Peter Hooper, Windsor, UK
I find it extrodinary that the government are now indroducing "green tax" when we are already covertly greentaxed. CERT (Carbon Emission Reduction Target) costs £20 per fuel per UK home - c£2.8bn over 3 years with other contributions from council tax taking it to £5bn over 3 years.
Pix, London, UK
Money is better spent on renewable energy schemes than financing a war. Infact the government should be spenting a 100 times more on solar pwer generation projects.They just injected 100 billion plus into the Rock bank fiasco.
Jim Wills, Brisbane, Australia
Well with all the hot air coming out of this Government wind turbines would be ideal.
Lammy, telford,
A decrease in the population would be a far better solution.
Reducing the 60 Million British population by 10 million would provide:
more housing, less traffic congestion, reduced NHS waiting lists, reduced pollution, reduced inflation.
All in all, the right way forward.
50 million for 2020.
Sean Hamerton, York., England.
Another excuse to raise taxes and dictate how we should live our lives.
Even if Britain sank beneath the sea tonight, and stopped producing any greenhouse gases at all, it would make no difference to global warming.
brummydoug, Birmingham, England
What nonsense this is. The grid infrastructure cannot take that volume of wind power and the more wind power there is the more unstable the grid becomes. We have abandoned decades of coal sitting under our feet and future generations will wonder why we left all these scrap metal follies for them.
DennisA, Newquay,
Rubbish. Higher bills are a result of the sell-out of utility companies to conglomerate owners such as EDF who are careful to exploit their monopolies, undeterred by a weak regulator
michael clarke, london, uk
Why can't we build a few more nuclear power stations?
Wouldn't this be money well-spent?
Fred, Cwm, Wales
The government is missing out on a trick here. Why not 'green tax' city bonuses?
Given the credit crunch fiasco and speculation-fuelled oil and food hikes, they don't deserve a penny of it. Even 50% tax would net a tidy £7bn a year for investment & grants in renewables, home insulation etc.
Stephen, Kirkcaldy, Scotland
The government is missing out on a trick here. Why not 'green tax' city bonuses?
Given the credit crunch fiasco and speculation-fuelled oil and food hikes, they don't deserve a penny of it. Even a 50% tax would net a tidy £7bn a year for investment & grants in renewables, home insulation etc.
Stephen, Kirkcaldy, Scotland
So when we have green power, and it's paid for, will the prices come down?
Rob Bain, Derby,
Wind farms do not work! They are expensive white elephants that have to have normal power stations online to back them up! In ten years there will be thousands of useless windmills waiting for the scrap merchants and all that money will have been wasted! Global warming is a money making scam!
Stephanie King, larnaca, Cyprus
Anyone suprised that Labour's response to any problem is higher taxes and a larger public sector ?
Are they hoping that "Greenwash" will distract us from their incompetent management of the economy ?
brummydoug, Birmingham, England
"Homeowners will be given financial incentives" this is what i call geen washing. I have a solar set up that was made for £1500. I could of got a comparable system using the govts "scheme" but this would have cost in excess of £7000. You have to use "appoved" companies, the system is a rip off.
bob, bristol,
More aspirations from Mr Brown - where is the detail
Mike, Gravesend, England
I still do not understand why the Solway Firth barrage was never built. Here we are surrounded by water ,miles of coastline,and what do we build. WIND turbines. I sometimes wonder.
g parker, auckland , new zealand
So he dare not instigate these price rises in this Parliament but instead will saddle the next Government with the pain and voter backlash?
If he was serious about climate change the conversion programme would be starting now. But Labour does not have the political courage.
Graham, Bradford, West Yorks
why not apply a profit tax to utilitiy companies - beat prices wouldn't rise so quickly then
Mike, Gravesend, England
I look forward to the Government's announcement that flight capacity has reached the maximum permitted and that there will be NO new development of airports or runways. New build will only be permitted when old is taken out of service.
Donna Walker, Effingham, England
What happens in 2020, if GHG continue to rise? Has anyone looked more closely at the ocean floors lately? Shelf spreading, thermal vents and many more volcanic eruptions are taking place which we didn't know existed. Methane ice is melting from the heat. Sea currents, C02 filling the oceans..
dan thorne, Washington, DC, USA
I think most people still believe that the green tax that is paid by them each year, was for this. Are we again paying extra towards something that the government should be paying for? Green tax and fuel surcharges for flying as a small example?
andy stayman, middlesbrough, england
WEll you can always ignore facts and be held to ransom by the oil and gas producers!
Mick, Winslow,
There have always been hidden supplements in utility bills, for Government promotion of pet projects, indulgence of friends in the NUM & NUR, etc,
But these new impositions should be paid by the enthusiasts and beneficiaries who promote global warming at the expense of the rest of us. Fat chance.
Albert, Paris,
Any time I see this level of rhetoric, I wonder which companies will benefit from these subsidies, and which MPs will invest in them.
Will we wait a decade to "discover" that there is something a bit dodgey about the whole thing?
jon livesey, Sunnyvale, CA/USA
More price rises, stealth-taxes and damage to our countryside under the cover of tackling 'climate change'.
Les, Southport, England