A new report has revealed the cost to taxpayers of the Climate Change Act will reach £300 billion by 2030.
The report by Peter Lilley MP, as reported in the Times, finds that there “is at best economic illiteracy and at worst deliberate deception” by government when it comes to the costs of the Act.
The costs are largely associated with providing subsidies to renewable energy which have raised household bills across the UK. A report by the National Audit Office earlier this year found just one scheme, the Levy Control Framework, will add £110 to the average UK electricity bill.
Lilley’s report also states that the Government currently does not include system costs in their official figures which artificially lowers perceived costs. System costs include the money required to be paid to keep baseload forms of energy such as coal and gas on standby for falls in renewable power.
The paper also revealed a report by former non-executive director of the former Department for Energy and Climate Change (DECC), Tom Kelly found systemic underestimation in the Government’s costings. He states “weaknesses in the original governance arrangements that were not rectified over time, a lack of transparency and a tendency to groupthink.”
In his column, Matt Ridley argues that spending is worrying as “this spending has to be forced by law,” and that “we have an energy policy that has imposed huge costs on the economy,”.
The increasing scrutiny of the UK’s energy policy comes while the National Grid is turning to traditional fuels to secure supply over winter, bringing coal-fired plants back online.
Find the full report here.