More spin about the future of UK electricity prices

Posted on Updated on

We should decarbonise electricity and doing so in the long run will save money anyway so what reason do we have for not doing it?

Yesterday it was the Labour Party putting this argument forward, today Greenpeace. According to their director John Sauven:

The Committee on Climate Change (CCC) predicts a proper switch to low carbon power could eventually save households up to £1,600 over the long term.

A saving of £1,600 per household? Surely this is enough to convince even the most ardent climate change denier to support building wind farms (and the dreaded nuclear power plants Greenpeace despises). As I wrote before this £1,600 figure is rather dubious, and not one the Committee on Climate Change actually produced themselves. It is to put it plainly spin. These cost “savings” are largely a result of a £76/tonne price on carbon emissions on gas plants in 2030. How many climate change “skeptics” would view cost savings due to a carbon price as real savings? The £1,600 per household figure is also a piece of trick accounting. Essentially all of the “savings” are allotted to households, whereas only about a third of UK electricity consumption is in houses.

The simple and honest position is that we are incredibly uncertain about how much electricity will cost in 2030. It’s possible that offshore wind will cost the same as gas (in levelized cost terms). However, it’s also possible that offshore wind could be something like four times more expensive than gas. This is simply the way it is, so ignore the green soothsayers and the shale gas prophets.

Advertisements