Cameron to 'roll back green charges'

UK Prime Minister David Cameron added to the spiralling air of uncertainty surrounding British clean-energy policy today when he pledged to “roll back some green regulations and charges”.

Speaking at Question Time in the House of Commons, Cameron announced a review of the costs that environmental initiatives add to consumer bills and “a proper competition test” of the UK energy market.

Cameron was attempting to wrestle back the initiative on consumer prices from opposition leader Ed Milliband – himself an energy secretary in the last Labour government that was voted out in 2010 – who has made huge political capital after promising a power price-freeze.

Cameron said: “We need to roll back the green charges that he [Milliband] put in place”.

The Prime Minister – who famously promised to lead Britain’s “greenest ever government” before he was elected – gave no details of what such a review could mean in practice, and said it was important to identify the support needed to attract investment into the UK.

Whatever the outcome, the remarks add to the sense that UK clean-energy policy is increasingly at the mercy of political imperatives, hardly the best recipe for investor certainty.

And the "roll back" pledge coincides with concerns in both the wind and solar sectors that even current levels of subsidy may not be enough to maintain momentum.

UK Renewable Energy Association (REA) chief executive Nina Skorupska said: “David Cameron must clarify which levies he is looking to roll back and how, or risk severely undermining investor confidence at a time when this country desperately needs investment in new low carbon capacity.

"Renewables are the only low carbon options on the table to bridge the near term capacity crunch, which will bite well before new nuclear or shale gas come on-stream."

Skorupska added: “Renewables policy makes up only 3% of average bills overall and less than a third of the Government’s ‘green levies’, so politicians and the media are simply wrong to say that green energy is to blame for pushing up bills. It is the ever-increasing cost of gas which has been the main cause of rising bills in recent months and years."

Cameron’s remarks will also heighten tensions within the UK’s ruling Coalition, where his Conservative party’s Liberal Democrat partners – and its energy secretary Ed Davey – are more supportive of renewable-friendly policies.

Davey recently defended government subsidies for wind and solar, and said that most green levies in the UK are funding social programmes to tackle fuel poverty.