It means that the Government will know ahead of time, exactly how much electricity will be procured when he sets the price he is prepared to pay.
Either way, it all means more expensive bills for the public—the very opposite of what was promised before the election.
The reason why ministers are having to pump so much more money into wind contracts is because of its rush to decarbonise the grid within five years. This requires a massive expansion in wind power over the next two auctions, and the result will be higher prices forced on to households and businesses.
It is the intensity of the Government’s race to acquire more wind generation, that is driving up its price.
Nevertheless, In Britain, customers have paid over half a billion pounds already this year for unused power generated by wind, because the electricity grid just hasn’t got the capacity to carry it.
Why the rush?
As I’ve said in this column previously, the most important bit of net zero is the ‘net’: we are bound to be reliant on hydrocarbons for several decades, so we need carbon capture to sequester more carbon than we emit by our continued reliance on hydrocarbons.
In the longer run, I support the objective of transferring to renewable energy, but our current folly is trying to achieve it a break-neck speed which is inflicting households with higher energy bills and rendering our energy-reliant businesses uncompetitive in international markets: it is costing jobs.
