Edward Davey MP: The greenest government ever — at an affordable price

Edward Davey MP is Secretary of State for Energy and Climate Change, and the Liberal Demoract MP for Kingston and Surbiton.

The Prime Minister pledged that this government would be the greenest ever. As the Secretary of State for Energy and Climate Change I am determined to make that a reality. But that is not my only challenge — I also have to make sure that we keep the lights on and keep energy bills as low as possible for the many people who are feeling the pinch.

So the package that I have announced on the level of subsidies for renewable technologies had to strike the right balance between  our need to reduce carbon emissions, our energy security and ensuring prices are affordable. I think we have done that. The rate of subsidy for technologies such as onshore and off-shore wind has dropped, reflecting the pressure we are putting on developers to drive down costs. Household bills over the period 2013-17 will be lower than they would be at current subsidy levels.

But we will still see a massive boom in investment. These support levels will help to unlock generation and network capital investment worth £20-25 billion between 2013 and 2017, resulting in the kind of sustainable long run growth and green jobs we need to get the economy moving again.

I know many local communities are concerned that decisions about onshore wind farms do not take adequate account of local concerns. That is why we amended the national planning policy framework so that local communities views are taken more into account. We are also legislating so that local authorities keep the business rates  from renewable generators. But I have also decided to launch a call for evidence to see how local communities can have more of a say over, and benefit economically from, the development of onshore wind farms.

We need more of our electricity generated from low carbon technologies but that does not just mean renewables. It also means nuclear power, if it is cost competitive with other low carbon technologies. And I also see an important role for gas. As our high carbon emission coal plants are withdrawn over the next few years gas will help to fill the gap. It will also play an important role in back up for the intermittent power supply coming from some renewable generation such as windpower. Longer term after 2030 gas can continue to play an important role when combined with carbon capture and storage technology.

Some people seem to think that shale gas will solve all our problems and usher in a period of cheap energy. There is no doubt that the discovery of shale gas worldwide has opened up new opportunities. But most reputable forecasters such as the International Energy Agency say that because of increases in demand for energy  in countries such as China, India and Brazil we will still see prices rising. We would not be doing consumers any favours by placing all our bets on shale gas. We must have a balanced approach.

Renewable energy has the potential to be a great British success story. As the CBI argued earlier this month, green policies can be an important driver of growth. Out latest announcements and the energy bill which I will introduce to Parliament in the Autumn are important stepping stones to achieving that growth.