How To Find Out How Much Electricity Costs Will Increase In The Uk

Transcription

1 19 th July 2013 GK Insight: Solar PV, Green Deal & Energy Storage Monitor This monitor has been developed for you as a member of BPVA, the national trade association of the UK solar photovoltaic industry. The purpose of this weekly newsletter is to keep BPVA members informed of key information on government policies in order to help members plan their strategy and assist them in their business development in the UK. For further information please contact BPVA on info@bpva.org.uk. GK Insight: Solar PV, Green Deal & Energy Storage Monitor is a weekly summary of UK political, government and parliamentary intelligence relevant to Solar PV, the Green Deal scheme and energy storage. It also includes links to media and parliamentary reports on content of relevance to these issues. GK is a well-respected political consultancy. Our team comprises former parliamentary researchers and Ministers. We work with our clients from a range of sectors, to help them understand and influence Whitehall, Westminster and Brussels. As part of our service, we provide political intelligence. For more detailed information and analysis, please contact robin@gkstrategy.com. Contents: Solar PV... 3 Parliamentary News... 3 Written Answers: Electricity Prices... 3 Written Answers: Green Investment Bank... 4 Oral Answers: Topical... 4 Government News... 6 EU-China Solar Panel Anti-Dumping Talks Face Fresh Flare-Up... 6 Secretary of State Responds to TaxPayers Alliance Claims Regarding Cost of Renewables... 6 Town Halls Allowing Solar Farms Over Fears of Legal Action, Minister Says... 6 DECC Publishes Consultation on Draft EMR Delivery... 7 DECC Publishes Consultation on Transitional Arrangements Between Renewables Obligation and Contracts for Difference... 7 Weekly Solar PV Installation & Capacity Based on Registration Date... 7 Written Ministerial Statement Published on EMR Draft Delivery Plan Consultation

2 Industry News... 8 New Research Determining Public Acceptance of Energy System Change... 8 Npower Warns of Future Energy Bill Increases... 9 Minister Highlights Importance of Solar PV During Conference... 9 Poll Reveals Renewable Industry Scepticism on Government s Green Investment Bank Financial News Energy Storage Parliamentary News Lord Highlights Importance of Energy Storage During Debate on Energy Bill Oral Answers: Topical Government News Centrica s 1.4bn Gas Store Could Be Shelved Industry News Energy Storage UK 2013 A Major Success EH Smith joins the British Photovoltaic Association Energy Storage: Next Growth Market in US and Europe Eos Energy Storage Announces Strategic Partnerships with Major Global Utilities Financial News New Cryogenic Energy Centre Planned in Birmingham Green Deal Parliamentary News Written Answers Oral Answers Government News Industry News Which? Mystery Shopper Exercise Raises Questions Over Green Deal Providers Industry Expert Claims Green Deal Will Take Off in Autumn Chris Huhne Says Treasury is Undermining Green Deal Pilot Finds Flaw in SAP System Financial News

3 Solar PV Parliamentary News Written Answers: Electricity Prices David T.C. Davies MP, Conservative: To ask the Secretary of State for Energy and Climate Change what estimate his Department has made of the number of households which will be paying higher electricity bills by 2020 as a result of the Government's climate change policies. Michael Fallon MP, Conservative, Minister of State for Business and Enterprise, Department for Business, Innovation and Skills and Minister of State for Energy, Department of Energy and Climate Change: The Government's recent assessment of the impacts of energy and climate change policies on consumer energy bills finds that electricity prices are likely to increase to 2020, with or without policies, as a result of rising wholesale energy and network costs. Although the costs of policies to support low carbon investment, improve energy efficiency and provide support for vulnerable households will also increase, these costs are expected to be more than offset by the reductions in energy consumption and exposure to volatile fossil fuel prices that policies are delivering. Overall we estimate that, in 2020, electricity bills will be on average 11% ( 72) lower than they would be in the absence of policies. David T.C. Davies MP, Conservative: To ask the Secretary of State for Energy and Climate Change what estimate his Department has made of the proportion of electricity costs in 2020 which will be due to the Government's climate change policies. Michael Fallon MP, Conservative, Minister of State for Business and Enterprise, Department for Business, Innovation and Skills and Minister of State for Energy, Department of Energy and Climate Change: The Government has recently published its assessment of the impacts of energy and climate change policies on consumer energy bills. The analysis in the report shows that policies are estimated to account for around 23% ( 46/MWh) of average household electricity prices in 2020 (2012 prices, excluding VAT). This figure only represents the cost of climate change and energy policies and does not reflect savings from policies that reduce energy consumption and consumer bills. Including the impacts of policies, electricity bills are estimated to be on average 11% ( 72) lower in 2020 with policies than they would be if these policies had never been introduced. Taking household bills as a whole (gas and electricity) policies are estimated to account for around 14% of energy bills in However due to policies such as regulations on boiler 3

4 efficiencies and household appliances, and on improving insulation such as the Green Deal, overall bills are estimated to be 11% ( 166) lower on average than they would be in the absence of policies. David T.C. Davies MP, Conservative: To ask the Secretary of State for Energy and Climate Change what his most recent estimate is of the change in electricity prices that can be attributed to the Government's climate change policies. Michael Fallon MP, Conservative, Minister of State for Business and Enterprise, Department for Business, Innovation and Skills and Minister of State for Energy, Department of Energy and Climate Change: Between 2010 and 2012 household electricity prices increased by 10% in real terms. DECC estimates that energy and climate change policies account for around 35% of this increase in prices, with increases in wholesale costs, network costs, and other supplier costs and margins accounting for around 65% of the remaining increase. It should be noted that the majority of policy costs fall on electricity, rather than gas, and figures on cost do not reflect savings from policies that reduce energy consumption and consumer bills. Considering household energy bills as a whole (gas and electricity), the Government's recently published assessment of the impacts of energy and climate change policies on consumer energy bills found that policy costs accounted for 15% of the overall increase in household dual fuel bills between 2010 and It also shows that once energy efficiency savings are accounted for, average household energy bills are estimated to be 5% ( 65) lower in 2013 than they would have been if these climate change and energy policies have never been introduced. Written Answers: Green Investment Bank Pauline Latham MP, Conservative: To ask the Secretary of State for Business, Innovation and Skills what contribution he expects the Green Investment Bank to make to green growth. Michael Fallon MP, Conservative, Minister of State for Business and Enterprise, Department for Business, Innovation and Skills and Minister of State for Energy, Department of Energy and Climate Change: The Government expects the Green Investment Bank to play a key role in mobilising additional private sector capital and increasing the overall scale and pace of investment into the UK green economy. By providing finance to projects that have a strong green impact while making a strong commercial return on its capital, the Bank will help demonstrate to the wider market that investing in green projects makes sound commercial sense. To date the Bank has committed 635 million to 11 projects with a total value of 2.3 billion, mobilising almost 3 of additional capital for every 1 provided. Oral Answers: Topical 4

5 Andrew George MP, Liberal Democrat:..While the Government s announcement on the strike price is very welcome, there are, as my right hon. Friend knows, many parts of the country that want to take full advantage of the future green energy revolution. Certainly in Cornwall we are very keen to become the green peninsula within the UK. Would he be prepared to come to Cornwall and speak to all aspects of the green energy revolution happening there, because we want to take this energy forward? Edward Davey MP, Liberal Democrat, Secretary of State for Energy and Climate Change: I pay tribute to my hon. Friend and his colleagues from Cornwall, who have been true champions for green energy and the impact that will have on jobs and the economy in Cornwall. He will know that I have already visited Cornwall, but I am very keen to visit again because it is such a powerhouse behind our low-carbon economy. Rushanara Ali MP, Labour: Last year the Chancellor boasted he was the first to fund a green investment bank, but that is not actually the case, because the Government are now borrowing 158 billion more than planned, and we will not have a proper green investment bank until 2016 at the earliest. How can the green investment bank be part of a growth strategy, and will the Minister provide an update on this? Gregory Barker MP, Conservative, Minister of State for Energy and Climate Change: The hon. Lady could not be more wrong. The UK Green Investment Bank, which was introduced and created by this coalition the Labour Government had 13 years to introduce it, but did nothing has been going for only a matter of months but in that time it has invested 635 million and mobilised, in total, 2.3 billion. But it has 3 billion of capital, which was added to in the last spending round, so billions of pounds for green investment are coming directly from this Government, using our genius for financial services. This Government are pioneering it. Simon Hughes MP, Liberal Democrat: Will Ministers set out what contribution this Government s energy and climate change policies will make to the increase in jobs in the UK as a whole and in Greater London in particular? Edward Davey MP, Liberal Democrat, Secretary of State for Energy and Climate Change: My right hon. Friend will know that our policies are playing a big role in that. Three years ago, the Renewable Energy Association calculated that more than 18,000 people were employed in renewable energy in the Greater London area alone. That represented 19% of the share and was a bigger share than any other region had, and we expect that to grow. Across the UK we expect green jobs to be a very important part of the boost that our energy investment restructure will give. The House may wish to know that earlier today we granted planning consent to what will be the world s largest offshore wind farm off the Lincolnshire-Norfolk coast, with 3.6 billion of investment and 1,130 new jobs created. 5

6 Harriett Baldwin MP, Conservative: Setting up the green investment bank was one of the Conservative party manifesto pledges and I was pleased to hear in the reply to the hon. Member for Bethnal Green and Bow (Rushanara Ali) of the progress that is happening. What specific projects has the green investment bank been backing? Gregory Barker: My hon. Friend is absolutely right that it was the Conservatives who set up the Wigley commission, which came up with the original scoping ideas for the green investment bank. In practice, it has been terrific. It has invested 30 million in the Wakefield waste project, 46 million in the Walney offshore wind farm and 57 million in Rhyl Flats. It is supporting the new industrial energy efficiency programmes and, of course, has put a significant slice of debt into the Green Deal Finance Company that will allow green deal finance to flow. Government News EU-China Solar Panel Anti-Dumping Talks Face Fresh Flare-Up Efforts by the EU and China to settle a dispute over solar panels have hit an impasse, threatening to reheat simmering tensions between two of the world s largest trading partners. (Available through subscription or free trial only) Secretary of State Responds to TaxPayers Alliance Claims Regarding Cost of Renewables Energy secretary Ed Davey has dismissed as fictitious claims by the Taxpayers Alliance that green energy policies will drive energy bills up significantly. 6 Town Halls Allowing Solar Farms Over Fears of Legal Action, Minister Says

7 Councils are voting through plans for menacing solar farms that blight the countryside because they are so afraid of being taken to court by developers, a Minister has admitted. DECC Publishes Consultation on Draft EMR Delivery The Government has published a consultation on the draft Electricity Market Reform Delivery Plan, providing detail on the support mechanism (long-term Contracts for Difference) and draft strike prices for renewables, including solar. This is intended to help incentivise up to 110 billion of investment in new electricity infrastructure by The consultation closes on DECC Publishes Consultation on Transitional Arrangements Between Renewables Obligation and Contracts for Difference A consultation was also launched on the transitional arrangements that will apply between the closure of the RO and the introduction of CfDs. It also seeks thoughts on the appropriate timing for the introduction of the fixed price certificate scheme, currently scheduled for The consultation closes on Weekly Solar PV Installation & Capacity Based on Registration Date 7

8 There were 1,351 sub 50 kw PV installations registered during the week ending 14th July 2013, compared to 921 in the week ending 7th July The trend in 2013 has been broadly flat, but there was a noticeable upward movement in June, as the tariff change approached. The total number of sub 50 kw solar PVs registered on the MCS database to just over 450,100. Total capacity installed during the week ending 14th July 2013 was 4.6 MW compared to 3.0 MW for the week ending 7th July The overall increase in installed capacity is 0.3% with the level at the end of week ending 14th July 2013 standing at 1.61GW. Written Ministerial Statement Published on EMR Draft Delivery Plan Consultation A statement from the Secretary of State for Energy and Climate Change, Ed Davey, was published providing an overview of the draft EMR delivery plan currently out for consultation, and confirming the publication of report from National Grid and an independent panel of technical experts who oversaw National Grid s analysis. The statement confirmed that that The Government will use the evidence gathered through this consultation to inform final CfD strike prices, which we intend to publish in the final EMR Delivery Plan later this year, subject to Royal Assent of the Energy Bill ElectricityMarketReform.pdf Industry News New Research Determining Public Acceptance of Energy System Change A study funded by the UK Energy Research Centre (UKERC) and carried out by a team based at the Universities of Cardiff and Nottingham, has revealed that: 8

9 Public wants to see transition to an efficient, clean, fair and safe energy system 82% are worried about the UK becoming too dependent on energy from other countries 74% of participants are very or fairly concerned about climate change Support for solar energy (85%) remained very strong. But trust in both energy companies and Government is low - which could hamper energy system development Npower Warns of Future Energy Bill Increases RWE npower has published new research predicting that the average household bill will rise 240 to 1,487 by 2020, primarily because of the impact of "unprecedented investment in new infrastructure, and the cost of improving energy efficiency in people's homes". It claims policies such as the carbon floor price and Energy Company Obligation (ECO), which mandates utilities to fund insulation for poorer households, currently comprise 185 of the annual household electricity bill - a figure that is set to rise by 78 per cent between 2013 and 2020 to 329. Climate Change Minister Greg Barker responded that Global gas prices not green policies have been primarily pushing up energy bills," adding that government policies would ensure bills are lower in 2020 than they would be otherwise. sets/iandc_pdf_futurereport2.pdf Minister Highlights Importance of Solar PV During Conference Minister of State for Energy and Climate Change Greg Barker spoke at Energy Storage UK 2013, a conference organised by the BPVA. During his speech the Minister highlighted the importance of solar PV as a major contributor to the energy mix in the UK. Further details of the conference can be found under the Energy Storage: Industry News section of this monitor. 9

10 Reza Shaybani, Chairman of the British Photovoltaic Association, with Minister of State for Energy and Climate Change, Greg Barker MP Poll Reveals Renewable Industry Scepticism on Government s Green Investment Bank New research conducted by Invest in Cornwall, Cornwall s European funded inward investment service, conducted with the UK s foremost experts in the renewable energy industry, reveals deep scepticism on whether the government s Green Investment Bank (GIB) will deliver significant benefits. Six in ten (61%) of the renewables experts surveyed do not believe the 3 billion invested in the GIB is sufficient to help accelerate the UK's transition to a more green economy within the next five years. Financial News No relevant news 10

11 Energy Storage Parliamentary News Lord Highlights Importance of Energy Storage During Debate on Energy Bill During a debate on the Energy Bill, Lord Oxburgh (Crossbench) tabled an amendment calling for an energy investment advisory board that could look at issues across the spectrum including energy storage, saying: This could be a very valuable resource for Ministers. It is the kind of body that could see problems coming ahead of time in a way that typically does not happen today. It could see implications across the system for a decision here and a consequence there. It could look at generation, transmission, interconnectors and energy storage right across the spectrum, not to mention the markets and market interactions. Reporting to Parliament would be extremely important because it would give Parliament confidence that this piece of infrastructure was being properly looked after. The amendment was debated, with a number of other members of the House agreeing with the benefits of such a board. However, following assurances from the Parliamentary Under- Secretary of State, Baroness Verma, that she will consider this issue, the amendment was withdrawn. Oral Answers: Topical Neil Carmichael MP, Conservative: What steps is the Minister taking to promote the development of energy storage systems, notably liquid air, which would be a good solution to our energy problems in the future? Edward Davey MP, Secretary of State for Energy and Climate Change: My hon. Friend will know that we have an innovation fund directed at encouraging new forms of storage of energy. It is bringing forward a lot of new ideas, including the one he mentioned. We see the capacity market having a role in electricity storage, too. 11

12 Government News Centrica s 1.4bn Gas Store Could Be Shelved Centrica s 1.4bn plan to convert an empty gas field into a storage facility to help with any future energy crisis could be shelved after the Government signalled that it did not believe Britain needs more storage. Industry News Energy Storage UK 2013 A Major Success As the sun began to shine on another hot day in London, the rising temperatures did not deter over 160 delegates both BPVA members and guests attending the Energy Storage UK 2013 conference organised by the BPVA. The day began with an introduction from BPVA Chairman Reza Shaybani, who also announced the formation of British Energy Storage Industry Association (BESIA), which will be representing the growing number of UK companies in the energy storage industry. The event offered an incredible line-up of guest speakers, including CEOs of battery manufacturing companies, software developers, research organisations, economists and experts in the energy storage industry and delegates from all over the world. Energy Storage UK 2013, was sponsored by SMA Solar Technologies one of the founding members of the BPVA. Reza Shaybani, Chairman of the British Photovoltaic Association commented Our goal is to promote energy storage, making sure it will become an important and valuable part of the sustainable energy landscape and to bring solar PV and energy storage industries closer together, building a more efficient, more reliable, cheaper, and safer energy supply. The development of storage solutions for PV electricity is critical to the future of the industry and will greatly advance its ability to work alongside or even replace existing electricity sources, according to Reza Shaybani. The BPVA and BESIA will work closely together complimenting each other and will provide opportunities for their members. A number of solar PV and Energy Storage exhibitions and conferences are planned for including Solar Energy UK, NEC - Birmingham October 12

13 8 th to 10 th, Microgrid Forum in Amsterdam September 17 th to 19 th, and the World Energy Storage Forum in London March 4 th to 6 th EH Smith joins the British Photovoltaic Association EH Smith, one of the largest privately owned builder s merchants in the UK and supplier of sustainable products has joined the British Photovoltaic Association in a move which has further cemented the significant growth and opportunities in the solar PV industry. John Cave, Sustainability Director of EH Smith, has been appointed as a member of the Executive Committee of the BPVA. Along with strengthening their relationship with the industry, EH Smith is now leading the way for other builders merchants to take note of the importance and benefits that solar PV has to offer to the building and construction industry. John Cave, Sustainability Director, EH Smith said: We believe that Solar PV is a very important part of the future energy mix in the UK. We have been stocking PV since before the introduction of the Feed in Tariff in 2010 and have seen the exponential growth in the market over the last few years. Rising energy costs, energy security concerns and a commitment to carbon reduction all combine to drive the construction sector towards increased energy efficiency and on-site renewable energy. We have been impressed by the drive and focus of the BPVA and are delighted to add our name to an impressive list of members. Reza Shaybani, BPVA Chairman commented: We are very pleased that EH Smith, one of the largest building merchants in the UK, has joined the BPVA. Our aim from day one has been to bring the solar PV & construction industries closer together and this is a major step in that direction. Installing Solar PV should be part of the build process and not an afterthought. We hope that we assist EH Smith in every way possible to become the first builder s merchant to supply high quality solar PV and energy storage technologies to their long list of loyal customers. I am also delighted that John Cave will join the Executive Committee of the association. John s knowledge of the sector and his vision are an essential part of growing the industry further. The Executive Committee members are helping the team to develop a number of exciting projects currently. Energy Storage: Next Growth Market in US and Europe

14 A blog post claims that Energy storage is the currently missing link that will enable the intermittent renewable energy sources like wind and solar to play a much greater part in the future grid mix. Eos Energy Storage Announces Strategic Partnerships with Major Global Utilities Eos Energy Storage has announced partnerships with leading U.S. and European utilities, including National Grid, aimed at accelerating profitable deployment of Eos zinc hybrid cathode (ZnythTM) battery technology in highly reproducible applications on the electricity grid. Financial News New Cryogenic Energy Centre Planned in Birmingham The University of Birmingham has won a 6m grant from the Engineering and Physical Sciences Research Council to create a new Centre for Cryogenic Energy Storage. 14

15 Green Deal Parliamentary News Written Answers Energy Companies Obligation (ECO brokerage: Companies entering administration; Bids meeting reserve price; Supply of data on rural homes) Energy Companies Obligation: Scotland (ECO-eligible households in Scotland) Green Deal Scheme (Expected Green Deal take up) (Apprentices; Assessments in Staffordshire) Oral Answers 15

16 Topical (Predicted Green Deal installations) Household Bills (Measures to reduce energy bills) Government News No relevant news. Industry News Which? Mystery Shopper Exercise Raises Questions Over Green Deal Providers The government has been warned some firms providing Green Deal services are struggling to meet desired standards, after an undercover investigation revealed a number of official advisers failed to recommend the right energy saving measures. Industry Expert Claims Green Deal Will Take Off in Autumn

17 Paul Joyner, Director of Sustainable Building Solutions, part of the Travis Perkins Group, predicted that the scheme will take-off in the autumn. Mr Joyner identified access to finance as the key problem, but noted the importance of systems being fully tested, and emphasised that the scheme was in its early days. Chris Huhne Says Treasury is Undermining Green Deal The UK s flagship energy efficiency programme is being fatally undermined by the Treasury and an ongoing battle over the Conservative Party s future strategy, says the former energy and climate Secretary of State Chris Huhne, who says the Green Deal scheme needs stronger support from the top of government. In one of his first interviews since his release from prison in May, Huhne, who unveiled the scheme in November 2011, says better incentives must be provided to homeowners for the scheme to flourish. Pilot Finds Flaw in SAP System In the latest blow to the Green Deal, Affinity Sutton s second Future fit report has revealed that the standard assessment procedure over-predicted energy savings by an average of 77 per cent _IH+Daily+News &dm_i=1HH2,1PP36,7UMRQ9,63AGM,1 Financial News 17

18 No relevant news. If you would like further information on anything in this monitor then please contact Robin Grainger on or Terms and Conditions This Monitor and any other relevant materials sent by GK Strategy are for the exclusive use of the addressee. Any other distribution, use or reproduction is unauthorized and prohibited. 18