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Onshore windfarm subsidies to be cut in further shakeup of green levies | Onshore windfarm subsidies to be cut in further shakeup of green levies |
(34 minutes later) | |
The Treasury is to cut subsidies for onshore windfarms and solar panels again while increasing support for offshore wind turbines as part of a further shakeup of green levies to make them more cost-effective. | |
Danny Alexander, chief secretary to the Treasury, will unveil the plans on Wednesday after delivering a speech setting out plans for £375bn of infrastructure spending over the coming decades. | |
He said taxpayer support for solar and onshore wind would be cut as developers were finding ways to install them more cheaply. | He said taxpayer support for solar and onshore wind would be cut as developers were finding ways to install them more cheaply. |
The changes relate to so-called "strike prices" for subsidies after 2015, which give energy companies a guaranteed price for electricity produced from renewable sources and nuclear power. Essentially, the taxpayer provides a top-up on the market price of power. | The changes relate to so-called "strike prices" for subsidies after 2015, which give energy companies a guaranteed price for electricity produced from renewable sources and nuclear power. Essentially, the taxpayer provides a top-up on the market price of power. |
David Cameron had come under pressure from backbench Tory MPs and some ministers over the impact of windfarms and solar parks on the countryside in their constituencies. | David Cameron had come under pressure from backbench Tory MPs and some ministers over the impact of windfarms and solar parks on the countryside in their constituencies. |
However, Alexander said the overall level of subsidies would remain the same and stressed his commitment to helping the UK meet its climate change targets. | However, Alexander said the overall level of subsidies would remain the same and stressed his commitment to helping the UK meet its climate change targets. |
He told BBC Radio 4's Today programme: "I believe passionately in meeting this country's obligations on tackling climate change and meeting environmental commitments, but we should be doing so in the most cost-effective way we can." | He told BBC Radio 4's Today programme: "I believe passionately in meeting this country's obligations on tackling climate change and meeting environmental commitments, but we should be doing so in the most cost-effective way we can." |
However, the plan was criticised by Labour for undermining certainty for investors in renewables so soon after previous cuts to financial support for onshore wind farms and solar panels. | However, the plan was criticised by Labour for undermining certainty for investors in renewables so soon after previous cuts to financial support for onshore wind farms and solar panels. |
Chris Leslie, shadow chief secretary to the Treasury, told BBC Radio 5 Live: "They're just chopping and changing all the time – very bad for stable, long-term investment." | Chris Leslie, shadow chief secretary to the Treasury, told BBC Radio 5 Live: "They're just chopping and changing all the time – very bad for stable, long-term investment." |
It comes after ministers negotiated cuts to the energy company obligation – a programme to help poor households reduce their energy usage – as part of a deal with the big six firms to bring down gas and electricity bills by £50. | It comes after ministers negotiated cuts to the energy company obligation – a programme to help poor households reduce their energy usage – as part of a deal with the big six firms to bring down gas and electricity bills by £50. |
Earlier this week, Tim Yeo, chairman of the Commons energy committee, warned the cuts could open the door to a further attack on green levies, which make up less than 10% of energy bills. | Earlier this week, Tim Yeo, chairman of the Commons energy committee, warned the cuts could open the door to a further attack on green levies, which make up less than 10% of energy bills. |
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