Green energy prices ‘not passed on’  

Credit:  Belfast Telegraph, www.belfasttelegraph.co.uk 19 January 2012 ~~

Lower electricity prices generated by renewable energy are not being passed on to householders, the Consumer Council said.

Wind power producers are profiting because the cost is set by the more expensive fossil fuel needed to meet demand in the system. This means they may be over-rewarded for the electricity they generate, the lobby group added.

The council has published an analysis of the electricity market.

Chief executive Antoinette McKeown said: “The right level of incentives is needed to increase the amount of renewable generation but developers should not be over-rewarded to the detriment of customers.”

According to the organisation, the average electricity bill in Great Britain is £530 a year compared to £588 a year in Northern Ireland.

It said consumers were bearing more risk from higher costs than shareholders in electricity companies and prices were greater because energy policy is “confused and contradictory”.

The council warned the benefits from renewable energy like wind are not being seen by customers as power within the single electricity market (SEM) is set by the most expensive fossil fuel generator needed to meet demand on the system.

Prices from fossil fuel generators include the cost of carbon and fossil fuel and because renewable generators do not produce carbon or use fossil fuels therefore may be overpaid for the electricity they provide.

Ms McKeown said Northern Ireland needs a clear and detailed energy policy.

“We want to see the issue of affordability, security of supply and sustainability to be looked at in the round,” she added.