‘Green policies the last thing UK economy needs’

As ‘new green regulations’ come into force in the UK and power plants close, the country has no option than to rely on imported energy sources. With its troubled economy, a green policy is the last thing Britain needs, Richard Wellings told RT.

The country’s energy regulator Ofgem warned that new green regulations and policies could send fuel bills soaring as early as next month.

“The European commission is overregulating for no good purpose,” Richard Wellings, deputy editorial director at the Institute of Economic Affairs, said.

RT:Not great news for consumers. We’ve heard that we are going to be relying more on imports, but at the same time we are trying to meet our climate change target, we need to get all polluting power plants off the UK system. So is this unavoidable?

Richard Wellings: I don’t think so. This is really terrible news for consumers. So energy prices  have gone up by a 160 per cent since 2004. We’ve got 6 million households in fuel poverty, expected to rise to 9 million within just three years. And the problem is, of course, by having a high energy price in this country it tends to export economic activities from countries such as China or India. So with an overall effect of climate change being very small, it actually could end being counterproductive.

RT:You mentioned China and India. The government has said “Don’t panic, consumers. We’re going to keep Britain’s lights switched on” and actually as countries like China are demanding more imports that’s pushing the global process higher. So we are actually removing ourselves from the risk, aren’t we? We are looking towards renewable energy, non-fossil fuel types of energy?

RW: No, it means really exposing the UK more to external risk. For example, importing gas is a lot more vulnerable to security risks than importing coal. It comes from potential flashpoints, such as the Persian Gulf. And of course some US states now enjoy electricity prices around a third the price of in the UK, gas prices – around the fifth the price. This is putting British businesses at a major competitive disadvantage.

RT:Why is the government in the UK doing that? You are saying one thing, you are saying a different thing. What is going on?

RW: Part of that is going from the European commission. So the reason why these power stations are closing is because of the European pollution controls. There is more to do with acid rain and climate change – there is a very small environmental problem, but the cost of it is going to be absolutely massive. So we are talking about tens if not hundreds of billions of euros across the whole of the EU. Once again, the European commission is overregulating for no good purpose.

RT:Why is the UK following these plans if you are saying there is evidence to the country this isn’t going to be good for energy consumers; not going to be good for Britain as a whole?

RW: Well, it has probably to do with the rebranding of the Conservative party, so that they are trying to claim to be the greenest government ever. There is obviously strong support for environmentalism within a certain faction of the Conservative Party and David Cameron. So, it is mostly ideological, but the problem is given the economy’s hardly growing this is really the last thing Britain needs.

RT:How concerned should energy consumers be right now? What does this mean for the British energy consumer?

RW: They should be very worried about rising prices. According to some estimates bills could double again over the next decade. Business users should be very concerned. Rather than power cuts you’ll expect to have business users on special contracts where the power could be cut off for them before households actually get their power cut off. If we get a very cold winter this is to be extremely worrying.