Clean energy is better for the economy than shale gas and will produce billions of pounds worth of savings to cash-strapped households over the long-term, according to a government report.
A dash-for-gas, much vaunted as the short term solution to the problem of meeting the UK's rising energy needs, would only help if gas prices fell and carbon markets remained cheap, the report claims. "Even then such savings would be limited," the report, published by the Committee on Climate Change, states: "it would be a bet on an outcome that is the opposite of most expectations."
However the report does recognise that shale gas has a role to play to help balance intermittent power generation, and meet demand for heat, provided appropriate environmental safeguarding regulations are put in place.
On the other hand, investing in renewable energy now could save households between lb25 and lb100 billion.
Lord Deben, Chairman of the CCC said: "THIS REPORT SHOWS THAT THERE ARE SIGNIFICANT BENEFITS AND VERY LIMITED RISKS FROM INVESTING IN LOW-CARBON TECHNOLOGIES. IT FACTORS IN THE POTENTIAL BENEFITS OF SHALE GAS, WHICH COULD PLAY A USEFUL ROLE IN MEETING HEAT DEMAND. IT SHOWS THAT THE COST-EFFECTIVE ROUTE TO THE 2050 TARGET INVOLVES INVESTMENT IN A PORTFOLIO OF LOW-CARBON TECHNOLOGIES IN THE 2020S. "HOWEVER, IN ORDER TO SECURE MAXIMUM ECONOMIC BENEFIT FOR THE UK, IT IS CRUCIAL THAT THE GOVERNMENT GIVES CERTAINTY TO INVESTORS BY LEGISLATING TO CHART A CLEAR COURSE WELL BEYOND 2020. ONLY THEN WILL WE BE ABLE TO INSURE AGAINST THE RISK OF MUCH HIGHER FUTURE ENERGY PRICES; ENHANCE BRITAIN'S ENERGY SOVEREIGNTY; AND PROTECT OURSELVES AGAINST DANGEROUS CLIMATE CHANGE."
The report recommends the Government:
. Introduces carbon reduction targets from 500 gCO2/kWh to around 50 gCO2/kWh in 2030. Extend development funding to 2030 to increase certainty and investor confidence. Sets strategies to develop less mature technology. Mobilises new sources of finance. Publishes intended electricity prices for 2014 - 2018 and the amount of capacity needed for that time.
Direct costs to consumers for investing in renewable energy would amount to just lb20 a year by 2020.
A Department of Energy and Climate Change spokeswoman said: "We agree on both the need to invest in a portfolio of low-carbon technologies, and the need to reduce our dependence on imported gas which is the main factor driving up household energy bills."Rebecca is a former columnist, correspondent and editor for "The Times", specialising in personal finance and property. She has two awards for personal finance journalism: one for pension and investment writing and also "consumer champion of the year 2009", for her weekly "Troubleshooter" column. Rebecca has a first class MA in English Literature from Edinburgh University and is a part-time student of psychotherapy (a natural Rogerian: people are fundamentally good). She lives in Kent with her partner, son and Norfolk Terrier and loves yoga, The Thick of It and full stops. Read her views on the wind turbine debate here. @rebeccaoco
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