Renewables generation leapfrogs nuclear as domestic bills fall

Renewable electricity generation soared in Q3 2015 but continued to have little impact on domestic electricity bills.

Statistics released by the Department of Energy and Climate Change this morning revealed that throughout Q3 renewables generated some 13.4TWh of electricity, equivalent to 23.5% of total generation.

That figure – representative of a 33% year-on-year increase – meant that renewables leapfrogged nuclear power to become the UK’s second-largest sub-section of generation behind gas.

The increase has been attributed at least in part to a significant surge in solar PV capacity. Generation from solar PV for the period increased 73% year-on-year to 2.68TWh, driven by the UK adding 2.53GW of solar in Q1.

But despite soaring renewables generation, domestic electricity bills have remained largely flat. DECC’s statistics show that the projected average electricity bill for 2015 is to stand at £584, down 2.4% in real terms on 2014’s average bill of £592.

Those figures appear to contradict the department’s claims that higher-than-expected renewables deployment would drive domestic bills up, rhetoric which prompted a raft of cuts to green subsidies under the guise of protecting bill payers.

Former energy secretary Ed Davey has continuously countered claims that bills would increase and the Levy Control Framework would be overspent and labelled them “lies” owing to the Merit Order Effect. The effect argues that as more, cheaper renewables come onto the grid the wholesale cost of electricity falls. Davey has argued that as the LCF only takes into account the gross cost of subsidies and not the net cost (costs minus reductions to the wholesale price) it should not be used as a complete gauge of costs passed onto consumers.

Speaking to Solar Power Portal last week, Davey said that it was “about time” the energy and climate change select committee investigated the Levy Control Framework and DECC’s claims regarding it.