Energy auction
Green levies threat to bills after wind farms expansion

Subsidised contracts announced for the biggest ever expansion of offshore wind farms in the UK have been met with disputed claims over their impact on energy bills.
The projects include Berwick Bank, the world’s largest offshore wind farm off the east coast of Scotland.
Some analysts warn that despite the record haul of offshore wind, the government will still struggle to meet its 2030 “clean power” target.
The UK government says that wind projects are cheaper than new gas power stations and will “bring down bills for good”, but critics say they could add up to £1.8 billion a year in green levies. The industry says this would be largely offset by savings from the wind farms lowering wholesale power prices.
Ed Miliband, the energy secretary, said the hundreds of new turbines were “a monumental step towards clean power by 2030” and would be significantly cheaper than the alternative of building gas plants.
The wind farms have a capacity of 8.4 gigawatts, enough to power the equivalent of more than 12 million homes.
The wind farm developers have been handed contracts guaranteeing that households and businesses will pay a fixed price for the power they generate for 20 years. The vast majority of the contracts have gone to a German energy company, RWE.
Shares in Perth-based utility group SSE moved higher after it was another big winner in the auction. It secured a 20-year contract for 1.4 gigawatts of offshore wind power.

Because new cables will not be built in time, there remains a risk that consumers will have to pay billions of pounds a year to switch off some of the new turbines.
There are also claims that the latest deal will lock consumers into higher bills for decades, regardless of the price of gas.
Claire Coutinho, the shadow energy secretary, said: “Miliband is so hell-bent on meeting his own self-imposed clean power targets that he is signing up to contracts which are not in the consumer’s interest.”
She said he was “obsessed with buying wind power no matter the cost”.
UK Government sources disputed this, saying the contracts would give the UK long-term certainty about energy prices and would be cheaper in the long term than replacing gas power stations.
Scottish Energy Secretary Gillian Martin welcomed the two Scottish offshore wind projects (Berwick Bank Phase B and Pentland) but said “much more could have been achieved at this pivotal moment”.
She added: “These projects are important for unlocking economic benefits and driving innovation in the sector, and will play a key role in delivering Scotland’s and the UK’s energy security.

“Unfortunately though, once again, this also represents a missed opportunity. We have repeatedly warned that a limited AR7 budget and unfair transmission charges would put Scottish projects at a competitive disadvantage, despite holding more than a third of the total UK offshore wind pipeline.
“These results clearly demonstrate the impact of the UK Government decisions not to address the unfair and disproportionate transmission charges to ensure level a playing field for Scottish projects. This must be fundamentally changed ahead of Allocation Round 8 (AR8).
“We call on the UK Government to act urgently to support the deployment of our strong project pipeline: there were a number of Scottish projects eligible for AR7, and we now must see those – and others in the pipeline – succeeding in AR8.
“The Scottish Government will continue to do everything in our power to support the delivery of our offshore wind pipeline, including by investing strategically to anchor the supply chain and develop port infrastructure.”
Dr Douglas Parr, policy director for Greenpeace UK, said: “The North Sea may be running out of gas, but it won’t be running out of wind any time soon. It is the best fuel to reduce the high energy prices gas companies have inflicted on UK homes.
“With new wind being cheaper than new gas, new nuclear or new biomass plants and lowering prices in electricity and gas markets, this auction keeps the Clean Power 2030 target, the government’s most ambitious climate commitment, on track.”










