Government hikes budget for renewable energy projects
The government holds an auction each year to encourage companies to bid to develop renewable energy projects to supply the UK grid with electricity. The scheme is designed to ensure projects get a guaranteed price – known as the strike price – from the government for the electricity they will generate, which it is hoped will enable companies to have the confidence to invest.
Last year, developers did not bid for any offshore wind contracts – they argued that the price being offered was too low to make the projects viable.
In November, the former Conservative government significantly increased the strike price for offshore wind projects in response.
Mr Miliband has said Labour’s commitment to maintain this higher price and increase the budget available for projects would “restore the UK as a global leader for green technologies”.
But Claire Coutinho, shadow Energy Secretary, said the government’s plans were untested and uncosted.
“Labour are ramping up renewables, at the same time as decimating investment in gas which is our only existing back up for when the sun doesn’t shine and the wind doesn’t blow. What will be put in its place? Ed Miliband can’t tell you,” she said.
Esin Serin, policy fellow at LSE’s Grantham Research Institute on Climate Change and the Environment, said the budget increase was a “welcome and necessary step”.
But she added that this year’s auction would likely only deliver 10GW of the 40GW needed for Labour to meet its 2030 target.
“It obviously leaves a significant amount of work to future rounds,” she said.
