Energy Secretary Ed Davey has announced a total of eight renewable energy projects, which will add 5% to the UK’s clean energy supply.
He admitted that energy bills are expected to rise by 2% by 2020, to cover the cost of the projects.
Each of the initiatives will be granted a Contract for Difference (CfDs), which guarantee a price for all renewable energy produced. This is estimated to cost up to £1bn per year in subsidies, but Davey argued this funding would serve to encourage more companies to invest in the UK’s renewable energy sector.
The contracts include a number of windfarms as well as the conversion of coal powered plants to biomass energy stations.
‘Critical’ for future of UK energy industry
Speaking on the BBC’s Today Programme, Davey said the developments were “critical to make sure [Britain has] secure, clean energy.”
“These are the first wave of our reforms, designed to stimulate investment in low carbon energy, but in a more affordable way than previously,” he added.
‘Imperative that affordability remains at the heart of policy’
Director of Consumer Policy at uSwitch Ann Robinson commented: “While delivering secure, clean energy is an important part of the Government’s energy market reforms, it is imperative that affordability and keeping household costs to a minimum remain at the heart of its policy.
“Although 2% over the next six years may not sound like a significant increase, with the average household energy bill now at an eye-watering £1,265 a year many consumers will be left feeling concerned by this announcement.”
“It is therefore essential that we all take action and do everything we can to minimise our bills right now. There are two key ways in which we can do this: ensure that our homes are as energy efficient as possible so that we’re not wasting energy, and that we pay as little as possible for the energy we do use by switching to the cheapest tariff for our needs.”