'Leccy price hike: Greens to blame as well as energy biz
Who's paying for your neighbour's solar panels? You are
And that's not all. The government has also seen fit to introduce another mechanism known as Feed In Tariffs (FITs) designed to shower cash on certain kinds of smaller-scale renewable generators such as rooftop solar panels. A householder installing solar panels on their roof gets paid a large sum of money simply for producing energy and using it himself: he gets paid a small additional amount if any of the juice is supplied to the grid. A person meeting all their electricity needs using their own solar panels added to their roof gets paid quadruple what their electricity bill would have been otherwise.
Again, this money comes not from the government but from that person's chosen electricity supply company: as FIT advocates gleefully note "the bottom line is that people who don't install renewable energy systems pay for those who do!".
Again, ordinary people see their bills driven up in order to reward those who can afford to shell out many thousands of pounds for solar panels - or to reward businessmen who can borrow that money easily and the financiers who lend to them. The solar panels would never pay for themselves normally in the UK's climate*, so another stealth tax on the less well-off has been introduced.
There are strong hints that the UK solar FITs will be reined in this year, as they already have been in Germany: a lot of businessmen were making big money out of these schemes. It's to be hoped that soon only smaller installations which are actually connected to a home will be eligible - although some will still grumble at having to pay a fat tribute to their solar-panel-owning neighbours as well as paying again to ensure that there will still be grid power there for them to draw on when the sun goes down.
In summary, then, we can all look forward to years of climbing electricity prices. The fossil-fuel markets will play their part, as will price-gouging by the Big Six energy suppliers. But more and more, other people and things will also be squeezing our wallets: in particular, windfarms and people with solar panels on the roof. ®
*Typically solar installations cost £4-5k per kilowatt of peak output. They yield perhaps 800 kilowatt-hours (units) per kWpeak each year: on the order of £80-£100 worth of electricity. They will pay for themselves in 40 to 50 years: but they will only last for 20.
The story's not quite so grim with other UK renewables, but in general, in a renewables-powered future, energy or anything which involves much energy - food, transport, manufactured stuff - basically everything - is going to be a hell of a lot more expensive. In other words, we're all going to be very poor.