03/02/2022 | Energy markets

Low-cost renewables offer the best solution for consumers hit hard by gas price hikes

03 February 2022 - RenewableUK press release


Responding to the energy price cap announced by Ofgem and the Government’s plans to help consumers with the cost of energy bills, RenewableUK’s Chief Executive Dan McGrail said:


“The measures set out by the Chancellor to provide support for hard-pressed families struggling to cope with the eye-watering hike in international gas prices are very welcome, but the UK needs to phase out fossil fuels as fast as possible to provide long-term energy security and certainty for consumers.


“Figures published today by Ofgem show that green levies are falling, so anyone attempting to blame renewables and net zero for high energy prices is seriously misinformed. Let’s be clear – this is a crisis caused by the soaring cost of gas.


“In the last three months of 2021, wind and solar power was so cheap that they actually paid back nearly £160 million to consumers, reducing energy bills. The escape route from volatile and uncontrollable gas prices couldn’t be clearer – investing in our green future secures low-cost reliable power as well as getting the UK to net zero as fast as possible”. 


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Notes


RenewableUK’s members are building our future energy system, powered by clean electricity. We bring them together to deliver that future faster; a future which is better for industry, billpayers, and the environment. We support over 400 member companies to ensure increasing amounts of renewable electricity are deployed across the UK and to access export markets all over the world. Our members are business leaders, technology innovators, and expert thinkers from right across industry.


More details on Ofgem’s figures showing green levies are falling are available here:Wind and solar paid back £157m to consumers in the final quarter of 2021 because, unlike volatile gas, they generate at an agreed price (called a strike price). When the wholesale price goes higher than the strike price, generators pay back the difference to the body which the Government has set up to run Contracts for Difference (CfDs), the Low Carbon Contracts Company. The LCCC ensures that these savings are reflected back in the form of lower bills for consumers in subsequent quarterly periods. 


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