Government confirm Cameron鈥檚 plan to 鈥渞oll back鈥 green charges on energy will not affect major infrastructure subsidies

David Cameron

The government has confirmed that the review of 鈥済reen tariffs鈥 on energy bills will not cover those charges which support the development of low carbon infrastructure.

Prime minister David Cameron yesterday pledged to 鈥渞oll back the green charges鈥 on consumer鈥檚 energy bills, as well as introduce a new competition test for energy utilities designed to ensure prices are kept down.

However a spokesperson for the Department of Energy and Climate Change (DECC) confirmed today that this review of 鈥済reen charges鈥 would not look at changing tariffs that support the construction of low carbon energy generation infrastructure, such as this week鈥檚 deal to support construction of Hinkley Point C nuclear power station.

In addition the spokesperson said the review would not cover charges which support the payment of feed-in tariffs for domestic renewable generation.

Referring to the review of green charges, the DECC spokesperson said: 鈥淭he government is looking at how to get people鈥檚 energy bills as low as possible to help hard-pressed families. We鈥檝e already increased competition, brought new players in to the market to offer consumers real choice and the most vulnerable are getting direct help with their bills this winter. We鈥檒l continue this work to make sure consumers are getting a good deal.

鈥淣o one is talking about changing support for large-scale renewables or feed-in tariffs, which are essential for investor confidence in the renewables sector and our commitments to a low-carbon economy.鈥

Liberal Democrat sources have accused Cameron of 鈥減anicking鈥 over the issue after being put under pressure by Labour leader Ed Miliband鈥檚 pledge to freeze energy prices if elected. The UK Green 好色先生TV Council has already expressed serious concern at the move, which has the potential to hit the 拢1.3bn spent annually by energy companies on the installation of energy efficiency measures under the ECO programme.

Miliband mocked Cameron鈥檚 move at prime minister鈥檚 questions yesterday, saying 鈥渢his is the man who said 鈥榲ote blue, go green鈥.鈥

The government is reported to be considering slackening the ECO 鈥 which pays for the energy efficiency retrofit of homes through a charge on all energy bills 鈥 to try and ease the pressure. This is despite the fact that in total 鈥済reen charges鈥 amount to just 9% of average energy bills, with the ECO accounting for 4%.

The latest Department of Energy and Climate Change figures, published last week, showed that the ECO has led to the installation of 244,882 retrofit measures through to the end of August, with 215,705 properties benefitting from the installation of one or more measures through the scheme.

Paul King, Chief Executive the UK Green 好色先生TV Council, said Cameron鈥檚 comments on rolling back green charges on energy bills were 鈥渋ncredibly short-sighted and potentially very damaging鈥.

He said: 鈥淲ith the cost of energy bills going up, policies such as ECO are essential in ensuring the homes of vulnerable and poorer income people are well insulated and will help to keep their bills down in the longer term. The government鈥檚 own analysis shows that, without these policies, bills will be much higher in the future.鈥