Letter To MPs.
By Paul Homewood
Here is the final version of a letter to your MP regarding Contracts for Difference:
The Government’s statements on the falling cost of offshore wind power are false and have disgracefully misled the British public.
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.
Obviously it is aimed at Tory MPs, but can easily be amended for other parties, for example:
“Please advise what action the Labour Party would take to ensure that these “lower costs” are passed on to energy users.”
I also plan to send this letter to various Parliamentary Committees.
Comments are closed.
NOT A LOT OF PEOPLE KNOW THAT 
My Question is:
When, if ever, will our leaders tell us what their true agenda is?
Clearly, it is not to the benefit of the citizens of our Western Countries!
Herman A (Alex) Pope
By Paul Homewood
Here is the final version of a letter to your MP regarding Contracts for Difference:
My MP failed to answer the question just gave me a stock answer that we have invested heavily in offshore wind nothing to see here.
My MP once told me that generic letters go straight in the bin. Far better to put some work in and do your own version.
Thanks for that Paul.Good one.
FYI.Daily Mail ,19 th April-“repairs to faulty smart meters to be paid for by the customer”,how nasty can they get.
D.Express April 21 “land owner jailed for one year for dredging part of a river so as to prevent flooding”.
He had complained many times about the lack of dredging,to no avail so he did it himself. Apparently the lesser spotted wotsits are more impotant than the locals.Even nastier!
Apparently the eco-fascist Environment Agency told him that it was his responsibility to deal with the river. On top of the ludicrous jail sentence he has been fined £600,000 which the top EA bimbo thinks is good to deter people doing something they can’t be bothered to do.
The answer appears to be that the government are consulting on backdoor ways to increase compensation to CFDs which they hope will not be transparent to billpayers, yet offer enough compensation to ensure that projects go ahead. What they have not yet grasped is that it will be a giant barn door, to a small back door if of is to work, and therefore we will see what they are up to.
https://www.gov.uk/government/news/government-explores-major-reform-to-flagship-renewables-scheme-to-improve-energy-security-and-drive-investment
Perhaps someone could clarify why, now that oil/gas prices are back to where they were before the war started, that heating costs are still sky high?
I can understand energy firms bought ahead but surely that must be working out of the system by now?
As for Paul’s letter, very good, but I won’t hold my breath on getting a coherent response
Gas prices rose substantially pre Ukraine as a consequence of the effects of lockdowns. The oil price never got as high as it did in 2012 (in nominal terms). The simple fact is, for a decade or more now, our bills have been substantially higher than they would have been under a largely gas generation policy. So even if they now fall back, that will be to a level well above what we could achieve. Governments have made our bills much more expensive than they could be simply on the promise that at some point they will become cheaper. Quite why we stand for it is beyond me.
Thank you, Paul. I have just sent a copy to my MP.
Regards, John.
It’s clear that the shift to renewables has now cost each household on average at least £4,000 over the last decade or so. That government keeps telling us it hasn’t is despicable. We are being lied to on a grand scale and because the opposition would do exactly the same thing, there is no challenge. And because half the country simply wants to blame the Tories, there’s no getting through to them either.
And that’s just the direct cost. The cost to businesses and thus to consumers in other areas is of a similar size. We are being made much poorer for no benefit that anyone can point to or measure.
I would like to understand how the ‘Market price’ is arrived at. If I recall correctly it was fluctuating between £50 and £60 per MWh prior to last year, and was mainly affected by the gas price. Is this not used as the basis for calculating CfD payments? And presumably if the CfD is as a result less than it otherwise would have been – helping to flatter subsidy figures – then the extra amount we are paying in our bills for the wholesale price of power should also be added to the cost of this green madness.
Richard the electricity market is complex beyond most people’s worst nightmares. Simply put, though, ALL suppliers in the auction system get the HIGHEST price paid to secure enough supply regardless of what they bid. If the highest bid required to meet demand is £1,500.00 per MWh (or more) then everyone gets that price regardless of how low they bid. YCMIU
That’s how the old pool system worked. It relied on there being enough competition to mean that the very highest prices occurred only very rarely. The new system is much more complicated with all sorts of different payments being doled out in subsidies.
The EU made it up…
‘Energy pricing models’:
https://energy.ec.europa.eu/topics/markets-and-consumers/eu-energy-prices_en#energy-pricing-models
“Renewable energy sources are produced at zero cost”
So the windmills and solar panels and all the infrastructure, access roads, cabling etc. are all installed free of charge?
I see…
Good – that you pushed the point about CfDs and I hope notice is taken of that, but I still take exception to the ‘creative accounting’ which claims that 12 million homes will benefit from wind power, while it is known that this based on nameplate output it is also very well known that wind turbines NEVER achieve this figure, usually averaging below 30% of this number. That point should have been put on the record as, a company that cooked its financial accounts to claim a turnover two-thirds higher than which was achievable would be prosecuted.
Sent.
And acknowledged.
This refusing to sell to the grid is outrageous, yet I can’t see that any MP is taking up the cudgel.
Correct me if I’m wrong.
Steve Baker MP is pursuing the issue. Then again he is one of the few properly educated ones with a BEng in Aerospace engineering.
Paul, thank you for prompting this.
Paul
With great respect, I don’t think my MP would understand what you are talking about
Thank you for all your work, Paul, and well done for this most recent ‘letter to your MP’.
Two comments:
In your letter, it might be useful to lay out the nature of the contract, to stress that the agreed figure is essentially a floor price. Any normally competent reader (and most MPs are that, we hope) could not infer so insane a system, without that extra bit of information.
I think that Charlie Flindt’s suggestion that we each write our own letter is a good one. But most of us won’t, so having a generic letter is good. I think that I might try sending your letter, with an accompanying letter of my own (just to show I really mean it). The MP for the constituency that starts a few yards from my house is one of the brave politicians that voted against the ludicrous Climate Change Act of 2008, so he doesn’t need the letter. My own constituency MP, however, probably does.
Sorry, Paul, but a complete waste of time. They already know this stuff. They don’t care.
I think you are wrong about that. They think that carbon dioxide takes the form of tiny black particles that come out of exhaust pipes, and give children asthma. What’s not to dislike? They think that wind and solar power are free. What’s not to like?
Yes, Mr Chapman, most of them are complete idiots.
Malcolm, Gezza – I’ve been corresponding (a one way dialogue) with my MP, a scientist, for a long time. She knows all Babout Paul’s work but, if she is sympathetic, she’s not showing it – too risky for her career.
Yes, I can understand that even a sympathetic MP might consider the politics to trump the science, in the situation we are in. I was mildly disgusted by the way in which the organisers of the London Marathon, in their attempt to appease the Green demonstrators, were keen to display agreement with all the tenets of climate alarmism. They also said that the greater part of the runners agreed with them (and I don’t know how they knew, but they could have been right – the marathon running classes are probably tilted that way).
And then there were the lawyers shouting of their virtue, and the combined churches of the world writing to the Times to show that they, too, were all good. It’s all rather unappealing.
Eventually, perhaps later than we might wish, this will become an issue at the ballot box. So far, the legislation and the policies have gone unchallenged, electorally. Eventually, and I think inevitably, the idiocies (relating to energy prices above all, but also car types and prices. and many other things) will become clear and undeniable, and some group of politicians (and it isn’t clear to me what manner of politic chicanery will lead to this) will see the opportunity at the ballot box. It may be the Conservatives, or Labour, or some outgrowth of the smaller parties, or something that we haven’t seen yet. I’m sure it will happen, and I do hope I live to see it. I have just entered my eighth decade, so time is getting a bit short, but I am optimistic.