Energy Bill is “playing catch-up”

The Government is “playing catch-up” on the Energy Bill, an energy academic said today warning the Contracts for Difference (CfD) are a bad idea. Catherine Mitchell, Professor of Energy Policy […]

By Priyanka Shrestha

The Government is “playing catch-up” on the Energy Bill, an energy academic said today warning the Contracts for Difference (CfD) are a bad idea.

Catherine Mitchell, Professor of Energy Policy at the University of Exeter was giving evidence at a hearing held by the Energy and Climate Change Committee about the electricity market reform.

Prof Mitchell said: “The bill is playing catch-up. We started off with a mechanism 20 years ago… We have not been successful, we’ve changed it twice.”

Her comments echo the concerns of some of the ‘Big Six’ suppliers when they told the Committee last week that more clarity is needed on the CfDs. The CfD provides a long term plan for stable and predictable incentives for businesses to invest in all forms of low carbon electricity generation.

Prof Mitchell added: “We should scrap the CfD. We should have a fixed Feed-in-Tariff…It’s a very bad idea to carry on with the CfD as it currently is but if we stick with what we’ve got we’re still in a problem. We’re not as a country getting ourselves organised to have an interconnected forward-looking energy system if we really want to get those opportunities for Britain.”

Dr David Kennedy, Chief Executive of the Committee on Climate Change agreed the CfDs should be designed like the Feed-in-Tariffs (FITs) to win back investor confidence. He also said the Bill needs to offer investors long term contracts that provide security for low carbon investments.

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