Latest news with #ContractsforDifference
The Herald Scotland
19-05-2025
- Business
- The Herald Scotland
Glasgow has shown a sad lack of ambition with George Square proposals
The cost at £2.5 million was apparently deemed to be too high. Many millions of pounds have been spent on the hard landscaping required for the Avenues project which rumbles on and doesn't seem to have caught the imagination of the populace. I would argue that a fountain or a "wall of water" is fundamental to the success of the enterprise and a real justification for the redesign of this prime civic space. Once again the planners have shown a real lack of ambition for the city by denying it a feature that would provide a vibrant, visual asset long after Glasgow's 850th anniversary celebrations have been forgotten. David G Will, Milngavie. Zonal pricing is common sense ScottishPower and SSE's outcry against zonal pricing ("Kate Forbes slams 'damaging' North Sea profits tax", heraldscotland, May 14) and demands for 'simplicity' in the CfD scheme reek of self-interest disguised as public concern. Keith Anderson of ScottishPower's claims of a £30 billion investment threat, alongside Alistair Phillips-Davies' recent alarm over ScotWind projects, are classic scare tactics. Let's be clear: they're defending a pricing system that props up their profits while offloading costs onto struggling households and businesses. Equally disingenuous were Kate Forbes's new-found concerns about the 'damaging' impact of the UK's windfall tax. Zonal pricing is simple common sense: where energy is abundant, bills should be cheaper. Norway has proven it works – investment thrives, and consumer costs drop. Yet ScottishPower and SSE cling to a rigged system that inflates prices nationwide, shielding their margins from genuine competition. Mr Anderson's plea to avoid 'tampering' with a 'working' system is absurd. Working for whom? Certainly not the 6.5 million UK households in fuel poverty or the businesses fighting to stay afloat. Their warnings of higher costs are baseless fearmongering. Zonal pricing would cut bills where renewables flourish, reflecting real supply and demand. More importantly, a balanced energy policy – one that includes renewables alongside North Sea oil and gas, as well as coal – would reduce dependency on costly imports and stabilise prices. This is the only path to genuine energy security and affordability, not endless Contracts for Difference handouts to intermittent energy sources. If Ed Miliband backs zonal pricing, it would be his first sensible decision amid his bonkers Net Zero policies – policies that stifle North Sea oil and gas while increasing reliance on foreign imports, forcing the public and businesses to pay a premium compared to similarly placed countries. Enough is enough. Ian Lakin, Aberdeen. Read more letters These TV ads are disgusting Adverts at regular intervals are the price we pay for commercial TV. Those commercial breaks allow us to skip off into the kitchen to make the occasional cuppa. There have been times when the adverts on show have had an entertainment value with their subtlety, humour and clever use of language. Recently however our screens have been flooded with a spate of adverts which bring with them the cringe factor thanks to the coarseness and crudity in which they are couched. In particular I would like to point out those adverts which deal with female incontinence deodorants and indigestion remedies. Not one of them is characterised by subtlety, light humour or clever wordplay. Rather they are explicit in the extreme, leaving nothing to the imagination with their brash, bold and bald language. Is there anyone else who shrinks with disgust when those adverts occupy the screen to induce the cringe factor in the viewers, a reaction I imagine may well be more widespread rather than restricted to my prurient personality? There have been memorable adverts which have lived on in the national memory thanks to the smart work of those trying to capture the attention of the viewing audience for the products on display. Have those days now receded into the past and are we to be left exposed to more of the current crop of adverts which leave the TV audience cold? Do those productions exemplify the collapse of standards in public life, which is increasingly evident in all facets of our nation? Denis Bruce, Bishopbriggs. An offer easy to resist A wee word of warning to fellow readers considering disposing of "unwanted items cluttering your home". An advert I saw stated "Free uplift and a fair offer". Sounds good, however, on the "fair offer" issue, a variance of opinion may arise. In my case, I submitted medals (six), Scottish bank notes (two), watches (10) and cigarette card sets (two). In my own estimation of the value of total goods was between £400/£500. I received a call one week later. In a very civil manner the rep remarked on the good condition of many of the items (for example, the medals being worth £50-plus). Finally, when pressed he made an offer of £75 (all inclusive). A derisory offer to end a promising exchange. Hopefully my great expectations consignment will be returned to me intact ASAP. Allan C Steele, Giffnock. Keith Anderson of ScottishPower (Image: PA) Banking? What's that? May I add a necessary addendum to Ian McConnell's rose-tinted writing of his younger journalist years following the Royal Bank of Scotland ('The tumultuous tale of a great Scottish hope', The Herald, May 16)? When the Royal Bank of Scotland imploded (and it self-imploded) not a single member of its board was a professionally qualified banker, not even its managing director – who had been appointed by his predecessor in his own image. Enough said. Graeme Smith, Newton Mearns.
Daily Mirror
15-05-2025
- Business
- Daily Mirror
British Gas boss in shock admission over electricity prices
Chris O'Shea, chief executive of owner Centrica, has spoken honestly of what he sees as the real benefit of moving to net zero energy such as wind and solar British Gas boss Chris O'Shea has delivered a stark message about the pursuit of a net zero power grid - warning it isn't the golden ticket to slashing electricity bills. Chris O'Shea, chief executive at Centrica - British Gas's parent firm - said: "The shift to renewable power will NOT materially reduce UK electricity prices from current levels." Taking to LinkedIn to express his thoughts, O'Shea stressed that the move towards net zero energy sources like wind and solar is more about delivering price stability and safeguarding against future price shocks than cutting household energy bills. "They may give price stability and avoid future price spikes based on the international gas market, but they will definitely not reduce the price," he noted in his post. This assertion puts him out of step with other energy leaders such as Octopus head Greg Jackson and Dale Vince of Ecotricity, not to mention Energy Secretary Ed Miliband. His remarks are at odds with claims made by the Government that shifting to greener energy would be a win for lowering family expenses. His comments come despite British Gas rolling out deals with cheap or even free electricity for certain customers during periods of excess wind and solar generation. In his warning, O'Shea explained that although the cheapest green technologies can compete with gas on price, others, like floating wind and tidal power, could set consumers back by up to three times as much. He said: "We need to stop having a polarised debate populated with unsubstantiated, but convenient, sound bites. I fully support the move to a cleaner energy system. I am simply very frustrated that people peddle misinformation at best, and disinformation at worst." These statements clash with Labour's election campaign promises from last year. At that time, Ed Miliband committed to reducing household bills by £300 annually by 2030 through a transition to clean energy. The Labour manifesto said: "Families and businesses will have lower bills for good, from a zero-carbon electricity system." After assuming office, Mr Miliband reiterated this commitment, announcing: "The only way to guarantee our energy security and cut bills permanently is to speed up the transition away from fossil fuels and towards home-grown clean energy." However, Mr O'Shea disputes that viewpoint. He cited the Government's Contracts for Difference (CfD) scheme as an example, which assures renewable energy producers a set, index-linked price for every megawatt hour they generate. When market prices dip under this agreed "strike price" the difference is passed onto consumer bills. Mr O'Shea said: "Wholesale electricity prices in the UK may well be set by international gas prices." He added: "But the wholesale price does NOT set the price that the majority of consumers pay in the UK. That's because of the Contract for Difference that renewable energy producers get. Essentially, no matter the wholesale price, renewable producers with a CfD get the 'CfD strike price'." Contracts under the CfD system generally last for 15 years, which means consumers are committed to those prices for an extended period. Highlighting the cost disparities, he mentioned that the average wholesale price of electricity last year was recorded at £82.11 per megawatt hour, while recent offshore wind projects achieved strike prices up to £82.16, and solar and onshore wind rates were around £70 – not enough to significantly lower bills. When it comes to pioneering green technologies, the costs soar: floating wind technology is priced at £195 and tidal stream generation at a staggering £240. Centrica is a major figure in the energy market, supplying approximately 7.5 million households and 400,000 businesses through its British Gas wing, and invests in a wide range of energy solutions from nuclear to gas and renewable projects like batteries and solar. The company boasts a workforce of 21,000 employees. Mr O'Shea's stance has been backed by figures on the political right. Reform UK's Energy Spokesperson Richard Tice said: "Another energy expert admits the British people have been deeply misled. More renewables will not bring the electricity price down." He added: "We have sacrificed jobs, industries and wealth on a lie. Net zero is the most stupid policy ever imposed on our nation." Conservative MP Andrew Bowie, the shadow energy minister, lashed out at Labour's eco commitments, alleging: "Ed Miliband's mad dash to net zero by 2050 has been built on ideological dogma, with a total disregard for the consequences inflicted upon the British public." Yet the Department for Energy Security and Net Zero stood by their strategy. A spokesman said: "We are making the UK a clean energy superpower to get off the rollercoaster of fossil fuel markets controlled by dictators and replace that with clean homegrown power we control." He continued: "That is how we can protect family finances and our national finances. As evidenced by the National Energy System Operator's independent report, clean power by 2030 is not just doable but would lead to a more secure energy system, potentially reducing electricity costs and lowering bills." Despite the International Energy Agency's data indicating UK's electric charges are among the highest in the developed world – 50 per cent above Germany's and quadruple the US prices – British Gas recently rolled out perks like complimentary electricity on select days bolstered with surplus renewable energy, aimed at managing grid demand while nudging consumers towards greener practices.
Yahoo
13-05-2025
- Business
- Yahoo
Net zero will not bring electricity prices down, says British Gas boss
Britain's shift to a net zero power grid will not bring down electricity prices down for families, the boss of British Gas has said. Chris O'Shea, the chief executive of British Gas's parent company Centrica, wrote on LinkedIn that the shift to renewable power 'will NOT materially reduce UK electricity prices from current levels'. He added: 'They may give price stability, and avoid future price spikes based on the international gas market, but they will definitely not reduce the price.' Mr O'Shea based his conclusion on an analysis comparing the cost of renewable energy with gas, showing that the cheapest renewables cost roughly the same as gas and the most exotic are up to three times as expensive. It suggests that the move to an energy system based around wind farms, solar parks or emerging technologies like tidal power will not lead to lower bills. The verdict from the boss of one of Britain's biggest energy providers represents a damning rebuttal of Labour's pledges to consumers. During last year's election campaign Ed Miliband, now Energy Secretary, promised that the shift to clean energy would save households £300 per year by 2030. Mr O'Shea said: 'We need to stop having a polarised debate populated with unsubstantiated, but convenient, sound bites. 'I fully support the move to a cleaner energy system. I am simply very frustrated that people peddle misinformation at best, and disinformation at worst.' The British Gas boss made no mention of any particular politicians or parties but his judgment contradicts claims made in last year's Labour Party manifesto, which said: 'Families and businesses will have lower bills for good, from a zero-carbon electricity system.' Mr Miliband said soon after his appointment as Energy Secretary: 'The only way to guarantee our energy security and cut bills permanently is to speed up the transition away from fossil fuels and towards home-grown clean energy.' Mr O'Shea's analysis centres on the role of Contracts for Difference (CfD), the system under which the Government guarantees renewable energy developers an inflation-linked minimum price for each megawatt hour of electricity their schemes produce. That minimum price is underwritten by consumers, meaning that if wholesale prices fall below the strike price the difference is added to bills. As a result, household bills are unlikely to fall even if the market price for raw electricity becomes cheaper. Mr O'Shea said: 'There's a bit of confusion on whether renewables will bring down energy prices from where they are today. People talk about the UK electricity price being set by international gas prices and therefore point to renewables giving us price reductions. 'However, the truth is a bit more nuanced. Wholesale electricity prices in the UK may well be set by international gas prices, but the wholesale price does NOT set the price that the majority of consumers pay in the UK. 'Why is that? It's because of the Contract for Difference that renewable energy producers get. Essentially, no matter the wholesale price, renewable producers with a CfD get the 'CfD strike price'.' In the UK the minimum prices set by CfD are guaranteed for a set period of time with 15 years being the most common length of contract for renewables projects. Mr O'Shea compared the wholesale energy price set by gas, which averaged £82.11 over the last year, with the 2024 CfD prices for renewables, pointing out that the prices are too similar to allow for any significant reductions. Fixed offshore wind got up to £82.16 per megawatt hour in last year's CfD round, while solar generation and onshore wind generators saw prices hovering around £70. That's slightly lower than gas but not enough to make any significant difference to consumer prices. Emerging technologies like floating offshore wind, with a strike price of £195, and tidal stream, £240, are set to prove far more expensive. Mr O'Shea words carry weight as Centrica serves 7.5m residential customers under the British Gas brand and 400,000 businesses. The company employs 21,000 people and is a leading investor in projects ranging from offshore gas production, nuclear energy and low carbon projects such as battery storage and solar farms. Richard Tice, Reform UK's energy spokesman, said: 'Another energy expert admits the British people have been deeply misled. More renewables will not bring the electricity price down. 'We have sacrificed jobs, industries and wealth on a lie. Net zero is the most stupid policy ever imposed on our nation.' The UK has some of the world's highest energy prices, especially for business and industry. Data from 2024, collated by the International Energy Agency showed that UK prices were among the highest of its 31 members. UK electricity was about 50pc more expensive than in Germany and four times as expensive as in the US. Mr Miliband's Department for Energy Security and Net Zero was approached for a response. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Yahoo
10-05-2025
- Business
- Yahoo
Miliband plots surge in wind farm subsidies to rescue net zero
Ed Miliband is plotting a surge in the wind farm subsidies added to electricity bills to prop up his ailing green power target. The Energy Secretary is preparing to ditch key limits on the cash diverted from bills to turbine developers, The Telegraph can reveal. The manoeuvre, uncovered in official documents, is expected to allow Mr Miliband to bankroll thousands of extra turbines in the next few years. He has pledged to make Britain's electricity supply 95pc carbon-free by that date. The target has been attacked as a 'fantasy' by the Conservatives, partly because there are too few offshore wind projects in the pipeline. That problem was exacerbated last week with Ørsted's decision to abandon its massive Hornsea 4 scheme to build 180 giant turbines off Yorkshire, giving 2.4 gigawatts (GW) of new capacity – enough for 2.6m homes on a windy day. To accelerate wind farm construction, Mr Miliband wants to scrap limits on the total subsidy on offer to offshore developers in Whitehall auctions. Instead a target would be set for the amount of electricity to be generated, with the cost to households only worked out afterwards. A Whitehall insider agreed costs could rise initially, suggesting that the investment in renewables now would bring prices down in years to come. 'It means short-term pain in energy bills, for long-term gain,' he said. The scheme was revealed in a paper from Mr Miliband's Department of Energy Security and Net Zero (DESNZ). 'In place of a budget, the Government would publish a capacity ambition,' it said. Mr Miliband wants between 43GW and 50GW of offshore wind by 2030. Only 16GW is operational so far, with another 12.6GW in planning. That leaves a shortfall of about 15GW just to hit the minimum, which would broadly mean adding an extra 1,500 giant 10-megawatt turbines to the 1,500 already planned. These must all be commissioned in the next couple of years to be working by 2030 – but developers are demanding extra subsidies to undertake the massive challenge. The main vehicle for such subsidies is the UK's contracts for difference (CfD) scheme, under which energy developers are guaranteed an inflation-linked minimum price for each megawatt hour of electricity their schemes produce. Ørsted won a bid last autumn to build the wind farm under the CfD scheme. The £85-per-megawatt-hour price approved by Mr Miliband is now deemed to be too low to cover the costs of Hornsea 4. It implies he will have to offer much higher guarantees to secure more wind farms. Analysts estimate that commissioning enough wind farms to meet the 2030 target could cost up to £11bn a year. They also estimate that the increase would add £135 a year to the average domestic energy bill. Mr Miliband's own officials also warned of potentially surging energy bills from his latest move. An impact statement said: 'This proposal may increase the subsidy (levy) cost of the Contracts for Difference scheme as it may facilitate buying increased capacity. 'Additionally, it is possible that the proposal may increase the subsidy cost of the CfD scheme if it leads to developers increasing their bid prices.' The Renewable Energy Foundation calculates that CfDs added £7.8bn to bills last year. John Constable, its director, estimated that hitting the 2030 target could require an additional £7.9bn subsidy to offshore wind and £3bn to onshore developers. Mr Constable said: 'With a small tweak to the green subsidy rules Ed Miliband can give himself the freedom to quietly and quickly add many billions of pounds a year to national electricity bills. 'If the Chancellor were to propose tax increases of this scale affecting every household and business in the country there would be a storm of criticism in Parliament and elsewhere. 'How much longer will the Prime Minister allow the Department of Energy Security and Net Zero to operate without democratic accountability?' A DESNZ spokesman said: 'We need to build clean energy infrastructure now to get bills down in the long-term and protect family finances from volatile fossil fuel markets that have caused the biggest cost-of-living crisis in memory. 'These reforms will pave the way for clean power by 2030, taking control of our energy system with home-grown power that we control and giving industry more certainty to build here in Britain. 'The contracts for difference scheme balances the need for significant renewables deployment to deliver the benefits of a low-cost clean power system, whilst providing best possible value for money for consumers.' The UK has about 3,000 offshore turbines, with a capacity of 16GW – plus 9,200 onshore wind turbines with a capacity of 15GW. The next CfD auction, the repeatedly delayed Round 7, is slated for the autumn. Ana Musat, from RenewableUK, the wind industry trade body, said: 'We have an opportunity to secure a record amount of new renewable energy capacity in this year's auction. 'It's good to see the ministers looking at some of the key reforms which are needed to unlock this.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
08-05-2025
- Business
Pembrokeshire set to benefit from UK marine energy task force
A MAJOR announcement at this year's Marine Energy Wales Conference in Cardiff has placed Pembrokeshire at the centre of the UK's marine renewable energy future. In a keynote address delivered virtually, Michael Shanks MP, Parliamentary Under-Secretary of State at the Department for Energy Security and Net Zero, confirmed the formation of a new industry-led Marine Energy Task Force. The task force will work to unlock the UK's full potential in wave and tidal technologies, with west Wales playing a key role. Minister Shanks told delegates: 'I'm pleased to announce that an industry-led Marine Energy Task Force is being assembled to consider marine energy deployment throughout the UK. Its key outcome will be the delivery of a strategic roadmap, including recommendations for removing barriers, along with estimates of the investment required to deliver the UK's marine energy potential.' The task force will be facilitated by the Marine Energy Council, with findings expected to inform future government policy. The move is seen as a strategic effort to accelerate clean energy development and promote regional growth in coastal communities. Wales has already attracted £292 million in marine energy investment and created 429 full-time jobs in the sector. With the Celtic Sea leasing process (Round 5) now in its final stages, up to 4.5 GW of floating offshore wind capacity could be developed, unlocking a potential £1.4 billion boost to the UK economy and creating more than 5,000 jobs. Welsh ports including Milford Haven, Swansea and Port Talbot were singled out by the minister as key delivery partners for future projects. Tidal stream energy was described as a continued priority, with more than 130 MW of capacity expected to be in place by 2029, supported by recent success in Contracts for Difference (CfD) rounds. Wave energy technologies are also receiving continued R&D backing, with commercial viability seen as achievable in the near future. Jay Sheppard, Project Manager at Marine Energy Wales, said: 'The formation of the Marine Energy Task Force marks a critical step in turning ambition into action. For too long, the potential of our marine resources has been acknowledged but underutilised. Pembrokeshire, with its natural assets and committed stakeholders, is well-placed to lead the way in unlocking the benefits of marine energy for communities and the wider economy.' The announcement follows renewed commitments from both the Welsh Government and UK Government to deepen cooperation on clean energy. Marine Energy Wales says it will continue working closely with local partners in Pembrokeshire and beyond to ensure that the region benefits from the opportunities created. The Herald understands that the initiative represents a clear signal of support for floating wind and tidal stream technologies, which have both seen growing investment and interest along the west Wales coast.
