Davey forced to explain PM’s energy policy blunder

Energy Secretary Ed Davey’s attempts to take “the politics out of energy policy” today were overshadowed by the confusion following David Cameron’s surprise energy policy announcement. At Prime Minister’s Questions […]

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By Vicky Ellis

Energy Secretary Ed Davey’s attempts to take “the politics out of energy policy” today were overshadowed by the confusion following David Cameron’s surprise energy policy announcement.

At Prime Minister’s Questions yesterday afternoon the usually careful Mr Cameron announced power firms would be made to offer customers their lowest tariffs, something DECC has since struggled to account for.

Fielding a barrage of questions about the apparent new policy direction, Ed Davey said: “A competitive market is a top priority for me. I do think we need to really strengthen competition and I think that’s what the Prime Minister meant yesterday.”

Earlier at the CBI’s Future of Energy event at Deloitte’s London office, the Lib Dem had light-heartedly emphasised “the Coalition is united behind these energy reforms”, after CBI chief Neil Bentley bemoaned “fruitless debates over false choices” between gas and green energy.

Ed Davey then denied the bill is “deliberately complex to hide a secret subsidy for nuclear” or advocating a “dash for gas”. He said these criticisms were “a long, long way off the mark” and was also adamant the “negotiations with EDF [over the strike price] are not going to fail”.

The Energy Secretary had opened his speech by acknowledging how important “regulatory certainty” is to investors, going on to talk about a key part of the Energy Bill, the Feed-in Tariff with Contracts for Difference which will set a price for low carbon power.

Mr Davey said: “Prices will be set administratively, aiming to bring all technology groups down in cost and begin levelling the playing field.”

He said he would like to see a time when all forms of energy didn’t need any help.

He told ELN after the conference more detail on the strike price will come with the Bill: “What we haven’t yet done is to explain to people about the allocation process, how CfDs will be allocated either in the first phase where price is set in the industry or the second stage.

“We haven’t said how that allocation process will operate and in looking at it and talking to the industry I think that they need earlier sight of the deal. That’s what we’re going to give them.”

Davey confirmed the Energy Bill would be due in November with a second reading before Christmas.