'Green Deal' won't work, experts warn

Flagship scheme ‘not guaranteed’ to save consumers money

The government’s ‘Green Deal’ home insulation project that launched today has faced criticism from experts who believe the scheme won’t achieve its goal of getting people out of fuel poverty.

Despite reassurance from government officials that the savings that will come with lower energy usage will outweigh the cost of the ‘green’ loans needed to install the energy-saving features, many experts believe that factors such as the interest rate of the loans (set at just under 7%), along with the cost of initial assessments of the property, set-up fees and operating charges, will put people off investing in the scheme. There are also worries that potential clients will be put off by the fact that the loan repayments are left with the house, meaning that someone moving into a property that has had energy-saving work done to it will have to take over the loan repayments.

The government's energy-saving scheme has been heavily criticised by experts

(Image source - www.bbacerts.co.uk)

Alan Milstein, chairman of the Residential Property Surveyors Association, said ‘For many consumers, taking on a green deal loan may not be the most cost-effective mechanism to fund any green improvements to their property. With early repayment penalties and the uncertainty surrounding how having a green deal loan attached to your property will impact on its future saleability, for many homeowners it may be advisable to look at alternative ways to fund energy efficiency measures’.

This news has put a dampener on the launch of the ‘Green Deal’, although according to a poll published last week, over 80% of people had never heard of the scheme.

'Green Deal? What's that then?'

Over 80% of people haven't heard of new government energy-saving scheme

Just days before a new scheme designed to help people deal with energy costs launches, a poll has discovered that 4 out of 5 people have never heard of it.

The ‘green deal’ works by offering loans to pay for home improvements such as roof insulation, new boilers and draught-proofing, which will help lower the overall cost of energy bills. However, a YouGov poll of 5,071 UK energy customers found that 81% hadn’t heard of the new scheme, with 51% citing that the initial cost of upfront ‘assessment fees’ of between £85 to £150 was a major obstacle for them.

The cost of things like roof insulation is putting people off making their homes energy-efficient

(Image source - solar-renewable-energy.co.uk)

The climate minister, Greg Barker, isn’t worried about the findings, as the scheme is still in its infancy, so people shouldn’t expect a ‘big bang’. He said, ‘We're right at the beginning of the green deal journey, and the report is right to identify there is relatively low consumer understanding around the green deal. It's as you'd expect, as it's yet to be rolled out. I expect that to change over the coming year’.

However, the shadow climate minister, Luciana Berger, has slammed the Coalition’s handling of the scheme, saying ‘It's very worrying that so few people have heard of the green deal just days before it finally goes live’. She added that the interest rates on the loans will leave people paying back more than twice the upfront cost of the measures they have installed, which she thinks will leave many people saying ‘no deal’ to the ‘green deal’.

Are politicians really that out of touch with the public?

MPs calling for higher wages despite millions struggling with low pay and rising energy bills

Earlier this week, the results of a survey of 100 MPs were released, showing that 69% thought that their annual wage of £65,738 made them ‘under-paid’, with the majority of them suggesting that their wage should be at least £96,740.

Considering the expenses scandals of recent years, and the fact that millions of people are struggling to afford things like food, housing, energy bills and general living costs, the news that MPs think they are hard done by is just astonishing. It’s not just because of things like their second homes, their expenses and questions about how much they actually do (apart from major events, how often is Parliament completely full?), but because of the simple fact that so many ordinary, hard-working people are having to face higher living costs without any wage increases and are being told by these very MPs that they’ll have to just put up with it because of the UK’s economic situation.

Despite millions of people struggling with living costs, MPs also think they have it rough

These opinions aren’t just held by one party however. 47% of Conservative MPs and 39% of Labour MPs felt they were unpaid. Only 9% of Lib Dems held this view, but they thought that the ideal wage for a politician was around £78,000. Dave Prentis, the general secretary of Unison, Britain’s largest public sector trade union, said ‘The idea MPs believe they deserve a 32 per cent increase is living in cloud cuckoo land’.  Matthew Sinclair, of the TaxPayers’ Alliance, agreed, saying, ‘Hiking politicians’ wages at a time of pay freezes, benefit caps and necessary spending cuts would be completely unpalatable to taxpayers.

Some MPs have tried to defend their responses, as one wrote in the anonymous comments of the survey that people have ‘no idea’ of ‘the pressure, breadth of knowledge and social skills that are required to do the job’.  If MPs feel they are unpaid, how do they think they rest of the country feels? Didn’t they think about the reaction of the public to their survey responses? Do MPs seriously believe a family struggling to make ends meet, who are have to face turning off their heating to afford to eat, or a graduate who can’t get a job despite having a first-class degree, would think ‘You’re right, £65,000 isn’t anywhere near enough for a politician’?

A lot of MPs seriously seem to have no idea what everyday life is like for a lot of people in Britain, and the results of this survey just show how out of touch they are with the British public by not seeing the irony of telling people to accept pay freezes, lower wages and higher energy bills whilst demanding higher pay for themselves. 

Backbench rebellion over energy bill?

'Decarbonisation target must be included' say MPs

Fears of a backbench rebellion in Parliament are growing following news that a decarbonisation target will not be included in the energy bill being put forward by the Coalition government.

Despite being seen as a crucial factor for climate change campaigners and supporters of low-carbon energy, any target on decarbonising electricity generation has been left out of the bill on the insistence of both the Chancellor George Osborne and the Prime Minister David Cameron. Tim Yeo, chairman of the energy and climate change select committee, is set to give a speech in the City this morning insisting that an amendment to the bill to include a decarbonisation target be brought forward when the bill reaches the reporting stages early next year.

The lack of a decarbonisation target is splitting Parliament

(Image source - The Guardian)

Yeo believes that a 2030 target to reduce carbon emissions from energy production is essential in encouraging investors to the UK and to give them certainty that the country’s long-term emissions-cutting targets are met. Yeo said that these issues were ‘a constant theme’ in his talks with investors, and believes that a specific decarbonisation target would ‘boost investor confidence’.

The Committee on Climate Change (CCC) has suggested that the target should be no more than 50g of carbon dioxide per kilowatt hour by 2030. Yeo said he would happily compromise with a target of 50 to 100g/kWh. The current figure is around 490g/kWh.

Another row over carbon targets is expected as Ed Davey, the secretary of state for energy and climate change, will announce the same day as Yeo whether the government will accept the advice of the CCC and include emissions from aviation and shipping in the UK's carbon targets. Many within the Conservative Party are opposed to this, but it would be damaging to the Liberal Democrats if Davey was to overrule the committee, the statutory body set up to advise ministers on how to meet long-term carbon targets, on this issue.

Fuel poverty set to rise

‘Inadequate’ Government policies blamed for increase in households struggling to pay bills

Christmas will be a difficult time for a lot of families as reports suggest another 300,000 households will be plunged into fuel poverty following recent price rises.

The independent Fuel Poverty Advisory Group has warned that nine million homes could be hit by fuel poverty by 2016 and have blamed the Coalition government for doing very little to ‘soften the blow’ of initiatives such as implementing green measures, which could add nearly £100 to the average energy bill, and getting firms to insulate the roofs of poorer customers’ homes, which will add another £100. With these measures, along with the recent price increases from the major energy companies, the average annual energy bill will be around £1,365.

More and more people are struggling to pay the bills to keep their homes warm

(Image source - The Mirror)

A policy announced by the Government which will limit the amount of tariffs energy companies can have and will force companies to offer customers the cheapest tariff has been criticised, as many believe it will actually cause prices to rise because it will effectively end competition for cheap deals and will stop customers switching tariffs regularly.

It has previously been suggested that nearly 90% of people will ‘ration’ their energy this Christmas in an attempt to save money, with elderly people more likely to do so, and more likely to suffer because of it. This Christmas, it is feared that fuel poverty will be directly responsible for over 2000 ‘excess winter deaths’, with that figure looking increasingly likely to rise as winters get colder and prices get higher.

Fracking laws needed says EU

Brussels warns UK about jumping 'headlong' into shale gas

The European parliament has warned it will regulate the shale gas industry as it claims the UK doesn’t know what it is doing with its ‘dash for gas’.

Jo Leinen MEP, a member of the parliament’s environment committee, believes the UK isn’t fully aware of the scale of environmental and health consequences that can occur from large-scale ‘fracking’, the controversial method of blasting rocks with pressurised water, sand and chemicals to force gases from them. Leinen said ‘In Great Britain they give the green light for industrial exploitation but they have to know what they are doing. I don't know if they can be so sure and clear about what they are doing”. 

The Coalition sees shale gas as a great opportunity, but may be ignoring the environmental implications of it

(Image source - The Guardian)

Recent reports on fracking from the European commission warn of the high risk of ground- and surface-water contamination, noxious air emissions, risks to biodiversity and noise pollution. However, just last week the chancellor George Osbourne announced that fracking firms would be offered tax breaks to set up in the UK, whilst energy secretary, Ed Davey, is expected to lift restrictions on a fracking site in Blackpool shortly, after it was closed when it was suggested the process may be triggered earthquakes.

Another criticism of the process is that, according to research, between 2500 and 3500 horizontal wells and 113 million tonnes of water would be needed to produce just 10% of the UK’s gas consumption over the next 20 years, with prompted Christophe McGlade, from the UCL Energy Institute who worked on a report for the European commission on the level of shale in the EU, to say, "Just because the resource is there, it does not mean that it can be produced economically."

UPDATE -

Energy secretary Ed Davey has now lifted the restrictions on fracking in the UK, allowing energy company Cuadrilla to resume its operations at the site in Blackpool. Despite protests from anti-fracking campaigners, who believe that this practice of collecting shale gas could be damaging to climate change targets and could potentially contaminate aquifers, Davey sees shale gas as a promising new energy source. Davey stated he has taken all factors into account, saying, "My decision is based on the evidence. It comes after detailed study of the latest scientific research available and advice from leading experts in the field",

Why hasn't solar taken off?

Form of renewable energy isn't as popular as it could be

Earlier this week, the chief executive of Desertsec Paul van Son denied his plans for a scheme to produce 15% of Europe’s energy from solar panels in North Africa was in turmoil following the withdrawal of two major investors. Both Siemens and Bosch pulled out of the project, which would see energy produced by solar power in countries such as Tunisia and Morocco relayed to Europe via underwater cables, whilst the Spanish government has backed away from a deal to build the panels. Despite these apparent set-backs, van Son laughed off suggestions the €400 million scheme was in crisis. But does this situation suggest that solar power has still yet to really take off as a form of energy production?

An outline of the Desertsec energy proposal - which may now be in doubt

(Source - The Guardian)

Solar power seems like the ideal form of renewable energy. Even more straightforward than wind power, all you have to do is watch as the sun shines and produces electricity. But despite this seemingly simple process of producing energy, solar has yet to really go mainstream. Whereas wind power is gaining more and more momentum as the answer to the question of how to produce clean, renewable energy, solar power is getting left behind. But why is this? Why haven’t we committed to solar yet?

Cost. Installing solar panels in a home can cost nearly £9000 on average; a price a lot of people aren’t willing to pay, especially as it may also require adjustments or renovations of the roofs of houses, which adds further costs. Many people could have had help covering costs via a grant, but last year the Government cut the Feed-In Tariff (FIT) by over half, meaning people who could have earned money for merely having solar panels (up to £1000 a year in many cases), which would have helped cover the cost of the initial installation, will now earn significantly less. 

Solar power is a great form of renewable energy - but people don't like the cost

(Source - The Guardian)

On top of all this, it has been announced that energy bills will increase to cover the costs of implementing green energy schemes, such as solar power. Any form of price increase is bound to anger consumers and, despite the assurances that using renewable energy will actually decrease prices in the coming years, the new deal has been met with criticism from consumers, MPs and environmental campaigners. 

So with the current negativity surrounding renewable energy in the media – mainly focusing on the cost – it seems that solar power has an even harder task of trying to appeal to people as a realistic alternative to traditional energy production.

Have energy companies been rigging prices?

PM threatens heavy fines for companies found to be manipulating market

David Cameron has called for heavy fines against all energy companies that are found to have rigged gas prices in the UK. 

The Prime Minister’s view comes after the Financial Services Authority announced an investigation into several major power companies that are accused of manipulating the wholesale gas market in Britain. Nick Clegg, deputy prime minister, backs Cameron’s stance, saying that consumers would be ‘rightly dismayed’ if the allegations of price rigging are found to be true.

Many of the companies accused of price rigging increased their prices last month

(Source - The Telegraph)

The FSA launched their investigation after word of ‘unusual trading patterns’ was revealed by whistle-blower Seth Freedman, who worked as price reporter at ICIS Heren, a company who set benchmark prices that wholesale gas contracts are based on. ICIS Heren reported to energy regulator Ofcom concerns about suspect trading on 28th September, which is the date of the end of the gas financial year and therefore an important influence on future gas prices.

This investigation will do little to improve the strained relationship between the energy companies and their consumers, which was already damaged following last month’s gas price hike.

Does the Government really care about green energy?

Tory MPs call on PM to publicly back renewable energy investments

David Cameron’s position on the green economy has been questioned by his own party after 20 Conservative MPs sent a letter to Downing Street expressing their concern over what they believe to be attacks on renewable energy and an anti-green sentiment from across the Coalition.

The Prime Minister is set to defend the Government’s policy on the green energy economy following criticism that many figures with the Coalition, such as George Osborne, are attacking the value of the sector, despite it being worth over £120bn and supplying a third of the recent economic growth in the UK. 

Many Conservative MPs, including Peter Aldous, MP for Waveney, who organised the letter, feel that Cameron’s silence on the issue may be putting off companies from investing into renewable energy schemes in the UK, and could see them invest overseas instead. Aldous called on the PM to clearly state what the Coalition’s position on the green economy is so that they can work to ‘encourage and incentivise investment from emerging markets…for our country to be a world leader in renewable energy’. 

David Cameron is currently pushing for investment in Britain’s energy production from the Middle East, and will meet with the heads of three of the biggest sovereign wealth funds in the United Arab Emirates to secure more investment in renewables. But in the eyes of many MPs, this isn’t enough. Cameron and the Coalition must come out and publicly back investments in green energy projects and, in the words of Energy Minister Greg Barker, ‘put its money where its mouth is’.

Britain doesn't need any more wind farms?

Political row as Tory minister claims UK has 'enough' turbines

The Coalition Government has clashed once again after a Conservative minister claimed that the country doesn’t need any more wind farms.

John Hayes told a newspaper that the country is ‘peppered’ with an ‘extraordinary’ amount of wind turbines which have been ‘imposed on communities’. He intended to include these comments in a speech Tuesday night but was told to remove them by Ed Davey, the Liberal Democrat energy secretary, who took control of renewable energy strategy from Hayes earlier this year.

This latest row is yet another in a long line of Lib Dem/Tory confrontations over renewable energy. In February, 101 Tories signed a letter demanding an end to onshore wind farm subsidies, and in the summer Davey had to fight to win a 10% cut in the level of subsidies, as George Osbourne had wanted a 25% cut.

Many people, including leading global wind and nuclear power companies, are worried that the continued in-fighting of the Coalition and political uncertainty could threaten millions of pounds worth of investment in energy projects in the UK.