Letter To MPs
By Paul Homewood
I have been asked to prepare a draft letter for sending to MPs regarding Contracts for Difference.
I suggest this:
We have been repeatedly promised by successive governments that the cost of offshore wind power has fallen substantially, and that this would lead to lower electricity bills. For instance, Kwasi Kwarteng announced last year:
“Our renewable energy auction scheme has been an outstanding success, with the latest round securing enough clean energy to power twelve million British homes and the price of clean energy plummeting even further.
Getting contracts signed means projects can push on and deliver jobs and opportunities across the country. This will help to secure our homegrown supply of cheaper renewables and bring down the price of energy for millions of British families as we shift away from expensive fossil fuels”
However the public are yet to see any of these supposed savings. In the last decade, the cost of subsidising renewable energy has already amounted to £86 billion. And this bill continues to rise.
So far this year, up to the end of March, the average price paid to offshore wind farms via Contracts for Difference has been £166/MWh – this compares to a market price of £120/MWh (according to data provided by the Low Carbon Contracts Company). This means a total subsidy during the period of £231 million, paid for by energy users.
Meanwhile, Moray East and Hornsea 2, the most recent windfarms to come on stream, which agreed prices of £74.49 and £83.94/MWh respectively, have refused to trigger their contracts, and are therefore profiting from much higher market prices. By the terms of their contracts, it seems there is nothing the government can do to force them to.
Worse still, there is another 11 GW of renewable capacity which has been awarded CfDs and which are due on stream in the next few years. These also have contract prices well below market levels, and it seems inevitable that these contracts will also not be triggered, unless market prices fall drastically.
Please advise what action the government is taking to ensure that these “lower costs” are passed on to energy users.
Comments are closed.
NOT A LOT OF PEOPLE KNOW THAT 
Good. I will use this or any refinement which becomes the consensus of your commentators but I do not think that my MP will understand the letter or the technical issues. He is a Corbynite. Most MPs at the time of the Milliband initiative thought that it was enough to believe that they were doing the right thing.
TC: You are absolutely correct. I consider my conservative MP to be something of a friend and we have a lot of exchanges. But I think that like all MP’s in the cyber age he is so swamped by emails that he uses an administrator (secretary in other words) to read anfd filter them. I have zero confidence that this complex issue would get past the gatekeepers and even if it did it wouldn’t mean a damn thing – my MP is PPE and History, Oxford.
Appreciated Vernon E.: It is the legislators’ willingness to support measures which are mostly beyond their comprehension. In many ways it is apparent that among Paul’s commentators as well as Paul himself there is an understanding of the subject and its implications that greatly exceeds anything reasonably available in the House of Commons. Not sure that even the members of the special committees gather in the necessary competence.
Brilliant! Keep it up!
Goverment ministers (and others) have got to stop lying to the public about the amount of power available (x million homes) from renewables when the maximum capable if being delivered is likely to be on the low 30%.
They must also stop telling us prices based on theoretical prices rather than real-world prices.
Excellent idea Paul. May I suggest sending it to some of the Committees in both the Lords and the Commons. (There are 316 of them altogether!) MPs & Lords who are GWPF members can advise better than I, but I would suggest: the BEIS Committee, the Environment and Climate Change Committee, the Climate Audit Committee, both Lords and Commons Finance Committees, the Rural Economy Committee, the Treasury Committee and both Lords and Commons Liaison Committees. There is usually, I believe, a Secretary who sends business out to Committee members. Happy to help.
Thanks Bill, I’ll take you up on that
Dear Paul
Here are the Parliamentary Committees that I think are relevant and their memberships. Contact details are at the bottom of each page.
The BEIS Committee here https://committees.parliament.uk/committee/365/business-energy-and-industrial-strategy-committee/membership/
The (Lords) Environment and Climate Change Committee here https://committees.parliament.uk/committee/515/environment-and-climate-change-committee/membership/
The Climate Audit Committee here https://committees.parliament.uk/committee/62/environmental-audit-committee/membership/
The (Lords) Economic Affairs Committee here https://committees.parliament.uk/committee/175/economic-affairs-committee/membership/
The Commons Finance Committee here https://committees.parliament.uk/committee/325/finance-committee-commons/membership/
The (Lords) Rural Economy Committee https://committees.parliament.uk/committee/388/rural-economy-committee/membership/ here and here https://committees.parliament.uk/committee/388/rural-economy-committee/membership/former/
The Treasury Committee here https://committees.parliament.uk/committee/158/treasury-committee/membership/
The (Lords) Liaison Committee here https://committees.parliament.uk/committee/187/liaison-committee-lords/membership/
The Commons Liaison Committee here https://committees.parliament.uk/committee/103/liaison-committee-commons/membership/
What would you like me to do? I can ring the Secretariats to chat them up and ask that your final version of the letter be sent to each member. I would need to know who you are in this context e.g. “Paul Homewood, the CEO of “Not a Lot of People Know That” the largest UK climate sceptic website”?
A short sub-heading to the letter would be important and it would have to be punchy e.g. “The Government’s statements on the falling cost of offshore wind power are false and have disgracefully misled the British public.” (if you think that is true)
You are probably aware that it would be no use sending emails to the MPs direct as they only take emails from their constituents.
I am unfortunately away tomorrow (12th) and Saturday, Sunday, Monday (15th–17th) but otherwise here. I can of course take any message on my phone.
Best wishes
Bill
07971 199 431 / 01329 663828
That’s a tidy piece of homework Bill. Maybe the soon to be king should be added and perhaps any sympathetic media too ?
Your efforts are appreciated Paul and that’s very encouraging having media involvement.
I tried approaching one of the select committees direct and was told to address it through my MP first. Typical civil service bureaucracy
And my MP’s Secretary wrote to say that she couldn’t comply with my specific request that my letter be forwarded to the relevant Committee Chair (after one of those “Public Consultations” that, unpublicised, lasted for just over a week).
The reason she was unable to comply?
Why, because her hands were tied by the Data Protection legislation!
I confess that my response was a little scornful. I never heard from her again. Nor (other than boilerplate blandishments) from my MP.
Presumably “Don’t confuse me with facts, I have made up my mind!”
And relying on the fact that any conceivable opponent to my MP at election time would be even worse than he is. Simples!
Just send it to them. Don’t ask their permission.
Maybe send it Certified Mail (or the UK equivalent).
If you have the actual agreed prices for Moray East and Hornsea 2 I think it would be quite powerful to include them to illustrate the rip off.
Well done, Ian
It might be useful to reference the actual subsidies paid over the last couple of years so MP’s can see this is not a one off situation. Also to forecast the likely total subsidy to the end of 2023. At present the numbers referenced seem quite small in the great scheme of things.
Might it be useful to point out these subsidies occur even at times of high fossil fuel prices so when fossil fuel prices decline the gap will be even larger?
I would add the question ” Are you aware that Government statements about energy costs are false due to the contracts being abused ? – if so why are you not pressing the Government to be truthful ? “
I emailed our MP for Wealden in January and again a couple weeks ago about Net Zero costs and energy prices etc. and have not yet had a reply to either. I’m not holding my breath..
If it is Nus Ghani, I am not surprised. She’s hopeless and the more I try to correspond with her the surer I am that she has the job because she ticks the right boxes. Charity employee and then into politics. She is hopelessly out of her depth.
I quite agree that the energy providers are playing the game and profiting from their contract terms at the expense of all consumers. The letter is an excellent idea and could be used to trigger a debate in parliament if we can get 100,000 signatures.
x
Nice letter. Copy with small edits sent to my MP: Gillian Keegan – MP
Member of Parliament for Chichester who can see Winds Farms from her patch.
Just the first sentence: not ‘we’. Start with: ‘The Government have always….etc’
I’m all for trying to educate our MPs or at least demonstrate that some of the electorate are aware that they’re being conned big time. I’ll wait a couple of days to see if there’s an edit before sending to my MP.
I will ask my MP, Sir Julian Lewis, if he will forward my letter to the relevant minister for his or her response. I will send you the reply when i get it.
Mine gone into my MP and i added challenge about what they are doing with future allocation rounds to address the ability to avoid entering into the CfD.
The AR5 Standard Terms are already published. They give the LCCC the option to declare a Start Date for the CFD, and to determine that the facility is in fact operationally commissioned, even if they haven’t been formally notified. Of course there might be a nod and a wink that they won’t exercise that option unless heavily pressed. They also offer no compensation for any hour where the day ahead price is negative. Previously, that would pay out the whole strike price of the CFD (but not the negative portion) so long as there weren’t 6 or more contiguous hours of negative prices – in which case the payout is zero for the duration. The ceiling on bid prices is just £44/MWh in 2012 money for offshore wind.
They could well find that there are few takers on those terms. There is likely to be a big capacity crunch looming with delays to wind farms that are now uneconomic, early closure of nuclear and nowhere near enough gas capacity to provide cover, especially is some of the older plant starts closing too. Losing the Norway-Scotland link to Norwegian refusal hasn’t helped.
Looming on the horizon is REMA, which will re-write the rules of the market. It will produce calls for lots of compensation if it toughens the terms for existing generators. It will need to do things like incorporate the subsidy mechanism for hydrogen and CCS, which is going to be very expensive. It will also find a back door to bail out the overly aggressive bidders.
All great stuff.
I try to ignore the fact that I’m wasting my time yet again and send another letter (or sign another petition).
But, if you consider the treatment meted out to Andrew Bridgen, quoting from HMG’s own statistics, proving that there is a genuine problem with Covid Vaccine Deaths and Injuries, (or anything else that is accepted as ‘The Settled Science” by every Uniparty MP), you need resources of optimism that I struggle to muster.
“Come back Guido Fawkes! All is forgiven!”
I think it’s a good idea to limit the scope to non functional and offshore CFDs rather than throwing the kitchen sink at them, which would produce MEGO syndrome. Other issues like rising curtailment payments at outrageous prices (Hornsea 1 got over £150/MWh recently in the Balancing Mechanism), consumers subsidising exports at negative prices and the stupidity over the Drax and Lynemouth CFDs that mean they only operate in times of extreme stress, etc. can wait until they become larger and more embarrassing.
Small grammar edit:
Worse still, there is another 11 GW of renewable capacity which has been awarded CfDs and which is due on stream in the next few years.
Capacity is singular.
Paul! I can’t think of anyone better qualified to advise this incredibly ignorant parliament! But thanks for asking! You are not lacking clever advisers, I see!
Dear Paul.
It is timely to address members of Parliament directly on the the issue of energy. Perhaps setting the context also against the high domestic gas prices would reflect consumers reality. For example over Easter I saw our combined fuel cost more than double. This is very worrying for the future. It had crossed my mind to write to my mp, but I felt I lacked first hand knowledge. I would be willing, as constituent, to add my signature to an open letter.
Not only gas, also petrol and diesel where more than half the price at the pump is TAX.
>>high domestic gas prices
My MP failed to answer the query response
“Thank you for contacting me about onshore wind farms.
The United Kingdom was the first major economy to legislate for net zero carbon emissions and since 2000, the UK has decarbonised faster than any other G7 country. Onshore wind is a key part of the Government’s strategy for low-cost decarbonisation of the energy sector and it will be integral to achieving net zero by 2050.
I can confirm that the Government already plans to introduce changes to the planning system in England allowing the construction of onshore wind. This would occur through a process whereby planning permission for onshore wind could be obtained dependent upon a project commanding local support and being able to satisfactorily address any impacts identified by the local community. The Government consulted on these changes and I understand that responses received to the consultation are being analysed. I look forward to reading the Government’s response in due course.
Separately, the Government has said that it will seek views on developing local partnerships for supportive communities to enable those who would like to host new onshore wind to benefit, for example through lower energy bills. The Energy White Paper stated that there will need to be sustained growth in the capacity of onshore wind over the next decade alongside solar and offshore wind. Therefore, the Government announced that onshore wind and other established renewable technologies such as solar PV will be able to compete in the Contracts for Difference (CfD) scheme. The Government has recently confirmed a budget of £205 million for the fifth allocation round of the CfD scheme.
I will continue to monitor any future developments closely”
I sent this in full to my MP.
Here’s his reply.
Campaign Response: Onshore Wind Planning Reforms
Thank you for contacting me about planning permission for onshore wind farms.
Protecting the beauty and local amenity of our countryside is something I consider of the utmost
importance. At the same time, it is crucial to boost our national capacity for renewable energy.
That is why I welcome the Government’s plans to introduce changes to the planning system,
whereby planning permission for onshore wind farms would depend upon a project commanding local
support, and being able to satisfactorily address any impacts identified by the local community. A
consultation will shortly be launched on how local authorities can demonstrate local support, and
respond to the views of their communities when considering onshore wind development in England.
Views will also be sought on developing local partnerships for supportive communities, to enable
those who would like to host new onshore wind to benefit, for example, through lower energy bills.
The Government will also consider how the planning system can support communities to have their
voices heard on the necessary infrastructure to connect wind farms to the grid, and upgrade existing
onshore wind assets.
It seems to me that local authorities, who understand the needs of their areas, are best placed to make
decisions regarding onshore wind sites. The Government has been clear that strong environmental
protections will remain in place, with valued landscapes such as National Parks, Areas of Outstanding
Natural Beauty and the Green Belt protected.
Onshore wind is one of the most cost-effective electricity generating technologies and already
accounts for approximately a quarter of installed renewable capacity in the UK. I look forward to
further details on the Government’s consultation soon.
Thank you again for taking the time to contact me.
Yours sincerely,
Adam Afriyie MP
Twitter: @AdamAfriyi
Good afternoon
I attach responses from my MP and the Minister to my letter to my MP based on your draft. Regards Paul Reynolds