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What's Fuelling Your Energy Bill?

Panorama's Tom Heap investigates the inconvenient truth behind the UK's rocketing energy bills - that government policy is stoking much of the rise.

Your money is being staked in the country's biggest energy gamble ever.

As power stations are closed down, due to old age or high carbon emissions, £200bn is needed to keep the lights on.

Fuel poverty now threatens one in four households yet the government remains committed to expensive alternatives like offshore wind and nuclear power: greener but, so far, dearer.

We welcome your comments on tonight's programme, please use this forum to tell us what you think. The programme will be available to view in the UK via the BBC iPlayer from shortly after initial broadcast.

Comments

  • Comment number 1.

    This was a disappointing and highly partial look at a really important issue. The role of energy efficiency was consistently downplayed, as was the fact that renewable energy costs can and will fall rapidly - provided programmes like this don't undermine investor confidence and create stop-start conditions. And the view that a new dash for gas is the answer is remarkable, given the fact that soaring gas prices are the main reason for high energy bills, and that new gas plants will lock us into a high carbon future. Even the International Energy Agency - not renowned for treehugging tendencies - says that a "golden age for gas" will lead to warming of at least 3.5C, nearly twice the level that scientists have identified as the critical danger threshold. A new dash for gas is a dead end for consumers and the climate.

  • Comment number 2.

    Fossil fuels getting cheaper? Surly investing in a low carbon future in the only sensible bet.

  • Comment number 3.

    For me, the timing of this programme is very fortuitous, as I have been reading James Hansen's Storms of my Grandchildren, the second half of which is remarkable for two things, the brutality of his criticism and the simplicity of the solution he proposes:

    It is brutal because he criticises (1) the failure of the UNFCCC Kyoto process (i.e. emissions target have not been met by anybody); (2) special interest groups for manipulating politicians (i.e. policy inaction is the goal of those that dispute global warming); and (3) governments for lying to themselves and us (i.e. catastrophic climate change can only be avoided by phasing out coal and not developing unconventional sources of fossil fuel)... In this respect, Hansen points out that the latter is the result of governments being caught between pro-fossil fuel and anti-nuclear lobbies who have ensured that, over the last 25 years, we have pursued one and shunned the other – the complete opposite of what we should have been doing.

    Therefore, Hansen's solution to our energy problems is one I was already in favour of (but I was nonetheless surprised to find him proposing it) – Fast breeder reactor (FBR) programmes (cancelled in the UK and US in 1989 and 1994 respectively) should be now be pursued vigorously because FBRs can be fueled by (1) the 99% of the Earth’s uranium that thermal reactors cannot use; (2) long-lived high-level radioactive waste (producing smaller amounts of less-dangerous waste); and (3) uranium extracted from seawater (where it is universally present at greater concentration than its average crustal abundance).

    This solves three problems in one: climate change, our energy crisis, and our existing legacy of radioactive waste. So why are we not doing it? Answer: because of the success of anti-nuclear campaigners in the 1980s…

  • Comment number 4.

    I am sure the programme content was fair and reasonably complete, but not a single mention of tidal stream energy, possibly because it is still in the development phase. I think the wind farm projects have been a 'gravy train' for some. Tidal stream will not be cheap but sea water IS ON THE MOVE ALL THE TIME unlike the fickle wind. There are vast amounts of energy to be derived from tidal movement and I would suggest more cost effective than any wind farm. As you must know tidal stream is currently under development in the Pentland Firth but I suspect it is very much underfunded compared with wind farms.
    It is conceivable that a sea water turbine could be incorporated close to each wind turbine. It wouldn't be an optimum position and the water level in some cases may not be deep enough but it would generate some power and more importantly could share the same cabling (uprated) utilised by the wind turbine.
    Also, sea water turbines could be placed at moderately optimum positions around our vast shoreline, not necessarily to generate electricity per se but to generate hydrogen for use as a domestic and vehicle fuel. Just imagine being freed from the 'shackles of oil' for the most part!
    The Strangford Lough tidal energy system is quite successful I believe, but I note that the University of Michigan have developed a fishlike device to derive renewable energy from slow water currents, this may be suitable for installation close to wind turbines at sea where water movement would be slow I imagine.

  • Comment number 5.

    I wish that the Government would use wave power, which could be used in close proximity to the off shore wind farms. The area would also help enrich the fish count as it would not be allowed to be fished until the fish stocks had spilled out into the surrounding area beyond the wind/wave farm. The waves are constantly moving unlike the wind which can vary considerably. I suspect that the only reason the government does not make more of this is because they have invested too much in oil/petrol. I hope that they come away from nuclear until they have a safer way of doing it. I do not want any more destruction on this planet. (Japan/Chenoble etc)

  • Comment number 6.

    how come they say natural gas is getting dearer , when I look at a chart of prices they have come down from 15.178 in 2005 to 3.700 today..this has always stumped me , could anyone explain

  • Comment number 7.

    The programme failed to distinguish between fossil fuel price rises causing current energy price rises and hence the desire to move to more stable priced sources of indiginous energy like renewables, failed to recognise that any new generation capacity whatever it is costs more than existing plant, did not mention subsidies for fossil fuels and missed the likely energy gap in 2015. Just because offshore wind farms are photogenic does not mean the BBC needed to show pictures of them almost every time price rises were mentioned. Where were the pictures of gas power stations? DECC’s own Annual Report on Fuel Poverty, clearly states that between 2004 and 2009, "domestic electricity prices increased by over 75%, while gas prices increased by over 122% over the same period", while the cost of generating electricity from wind, according to the Government’s official energy regulator Ofgem, is less than £10 per year per household, or less than 1% of the average household fuel bill. So relying heavily on gas will not drive fuel bills down in the future.” Ofgem in Project Discovery research, examined the impact on prices for a range of scenarios for different UK energy mixes up to 2020, and showed that if Britain fails to invest in renewable energy, electricity bills will be pushed up by 52% because of the volatility of fossil fuel prices. Offshore wind is a key renewable since it gives the opportunity to generate large amounts of renewable electricity and deploying it gives an opportunity for lots of UK jobs. RenewableUK has slamed as 'flawed' the KPMG energy report because it assumes rapid nuclear new build, ignores other lifecycle costs, such as fuel and decommissioning (not at all cheap for nuclear) and states that wind farms only generate electricity for about one-third which is a very basic error to make.

  • Comment number 8.

    I believe the programme has raised a very valid point about our prospective electricity bills. Wind energy generally and offshore in particular is very expensive but it is also unreliable. As I understand it, it has no or very little effect on CO2 emissions from coal fired power stations and the question is whether it significantly reduces emissions from gas fired ones, at least present gas power stations. There is even evidence from some reports that wind energy increases CO2 emissions.

    This is something that really needs a proper and full examination at a public inquiry where ALL sides can give their evidence to establish whether wind power does "what it says on the tin" at a reasonable price, or whether we are spending a huge amount of money for very little effect. Only yesterday I watched onshore wind farms in my area absolutely still - where is the electricity coming from when that (not infrequently) happens? And even the pictures of the offshore turbines did not appear to show them operating at full capacity. And finally, is it not likely that offshore turbines will have to be switched off more regularly because wind speeds are too high?

  • Comment number 9.

    Great article. Not against addressing climate change but it's not the ONLY problem we face. On the government's own figures 2,700 die each year in Britain because they cannot afford fuel. How many more will die as we ramp up our response to global warming? How many have to die before this government and others realise access to affordable energy is just as important as environmental ambitions?

  • Comment number 10.

    What about Microgeneration? Not a single word about how dramatically you can reduce your electricity usage/bill by installing Solar PV, even with the recent reduction in feed in tariff?
    DECC’s own Annual Report on Fuel Poverty, clearly states that between 2004 and 2009, "domestic electricity prices increased by over 75%, while gas prices increased by over 122% over the same period"

  • Comment number 11.

    I was going to explain why this was a very poor programme but I see that Damian Carrington has already made all the points in his Guardian piece at http://www.guardian.co.uk/environment/damian-carrington-blog/2011/nov/08/energy-bills-panorama-renewables
    The Panorama team should read it and feel suitably chastened.

  • Comment number 12.

    @biffvernon : Likewise, I presume there will be a 'Part 2' with the rest of the facts..?
    More on this at: http://www.goodenergy.co.uk/what-we-are-doing/good-energy-republic/2011/11/08/lies-damn-lies-and-energy-statistics

  • Comment number 13.

    I am very sorry that such an unbalanced and selective programme was put out on this important subject. We need to know about the long term future availability of gas versus the future availability of sun, wind, waves, of which Britain has an abundance. Latest WWF report says Britain can meet its needs from renewable energy sources.
    I paid for solar panels on my roof and my last electricity bill was £19.41, so why don't you interview me or other renewable generators.

  • Comment number 14.

    I also was disappointed with this programme, which seemed to have a dash for gas agenda. I was pleased to hear that people interviewed in the programme had made energy efficiency imporovements at home to reduce their bills. The programme however, did not mention by how much (%) they had reduced their consumption and what they were paying before and after they had made improvements. We could have learnt then how if their energy bills had actually increased and by how much.
    We have been living with cheap energy for too long and not paying it's real price i.e. environmental and social costs.
    The other issue not discussed was that subsidising renewables and providing incentives for energy efficiency stimuates a market and provides jobs and exportable knowledge. This has longer term economic benefits to the UK.
    We should not just be driving towards the cheapest method of producing energy because that is false economics since we will be paying the true costs in the longer-term; as we are now.

  • Comment number 15.

    At last the media is starting to comment on the facts behind “renewable” energy.

    It is not only ridiculously expensive but massively inefficient and the large scale adoption of wind energy and solar in Britain is going to cost us thousands of jobs.

    Industry simply will not pay the additional costs to subsidise these energy sources when they can move to other countries that provide cheap electricity through burning fossil fuels.

    The “Green energy” crusade is purely political and the adoption of wind and solar energy in Britain has been brought about political parties desperate for the green vote.

    Very little solid science has been used when making the decision to build wind turbines and subsidise solar panels.
    Economically it will be a disaster to ask industry to cut back on electricity use and to foot the bill for the massive subsidises to finance a green ideology which rests on turning our backs on consumerism.


    There are other options to CO2 emissions, options which are much cheaper and much more efficient at reducing our CO2 footprint than wind and solar. But these other options are not supported by the “greens” and the political spin doctors cannot link them to the green vote which would grant them instant backing from the political parties.

    The simple answer is to build 40 nuclear power stations across Britain. They would provide all of our energy needs, reduce our CO2 emissions to practically zero and cost a tiny fraction of the amount of wind and solar.

  • Comment number 16.

    Carrington's article in the Guardian spends much space countering a claim that renewables are responsible for the hike in our present energy bills. The Panorama programme spent only five minutes exploring energy poverty and made no comment about renewables in this respect.

    The remainder of the programme focussed entirely on the possible impacts of energy policy to 2020. Four experts lined up to say that the government's policy is more expensive than it needs to be. KPMG go so far as to say we could trim £35b off the proposed spend and still meet our emissions target.

    Huhne was given plenty of air time to explain how his policy is the cheapest option and it's based on two premises:
    we will adopt energy savings policies (but this is not a strategy unique to his renewables/nuclear thrust - energy saving can be bolted on to any future energy policy)
    we will be shielded from global, rising fossil fuel prices.

    Whether the last claim is correct or not is uncertain. We need to see the government's projections for these fossil fuel prices. But Dieter Helm made the obvious point: 'what if these prices do not rise?'

  • Comment number 17.

    This was a very unbalanced programme. When so much time and effort goes into the making of a documentary it can only be deliberate. The makers clearly have an agenda against wind farms. Anybody that is involved in electricity knows that the principal reason for electricity price rises is the year on year rise in gas prices. This is endorsed by Ofgem. Whilst renewables are more expensive than some current means of producing electricity from fossil fuels, there is no certainty that this will be the case in the long run as we have to import these fuels from abroad and are competing in an ever growing market for them. The contribution that renewable energy has made to price rises is small.
    Energy is a precious commodity and we are using ever increasing amounts of it. This is very concerning and pricing may ultimately be the only way of controlling consumption. The main driver for renewable electricity is combating climate change – principally through cutting our carbon dioxide output in relation to electricity generation. This was not mentioned at any point during the programme. When such a glaring benefit is also the overriding driver for the expansion of renewable energy, for it to have been omitted from the programme can only be a deliberate move to ensure that nothing positive should be said about the technologies. The fact that renewables deliver economic benefits to an expanding new industry and provide energy security without the need to buy and beg fuel from Russia, North Africa and the Middle East, is a massive bonus. Sort it out BBC.

  • Comment number 18.

    I was most surprised and disappointed with this Panorama programme; it appeared heavily biased against renewables and very much in favour of gas & nuclear... very strange as both of these methods of generation have their own peculiar shortcomings.. well known, but worth repeating:
    Gas will get more expensive as this finite resource is depleted, and
    A new nuclear station, when taking all emissions and energy required to construct & commission into consideration, will require 30 years of uninterrupted generation to become 'carbon/energy/emissions neutral' - a nuclear plant has a life expectancy of around 45 years - 15 years of 'carbon neutral' generation at the very most... then of course there's the inconvenient problem of decommission costs & all that toxic waste, still there, still piling up, stored securely - using even more energy of course.

    I invested in solar PV in 2006, solar thermal in 2009 and this year installed a solar back-up system for when (note, 'if' not 'when') the national grid starts to crumble, as it's widely expected to do, under pressure from multiple users and, not forgetting all those metal thefts...??

    My annual energy bills over the past five years averaged £68, whilst receiving significantly less feed-in tariff payments than those who installed post March 2010.

    The biased and one-side approach this programme adopted has playing into the hands of the 'big six' energy companies and climate change deniers throughout the country - I don't often criticise the BBC, one the better broadcasters in the world, but I must protest in the strongest possible terms - I didn't notice, for instance, any interview with anyone who had invested in alternative energy, so how about a 'right to reply'...??

  • Comment number 19.

    The facts are as I see them that fossil fuels are by far the cheapest form of energy, but the consequences of CO2 emissions require us to turn away from their use.

    The alternative is Nuclear power, which is more expensive than our current fossil fuelled electricity but can replace it with practically zero CO2 emissions and abundant energy production and energy security.
    In fact nuclear is the only alternative if we want abundant clean affordable energy.

    Wind/wave and solar are simply too intermittent and inefficient, also the cost would cripple industry and make electricity as a general consumer utility too expensive for anybody other than the extremely rich.

    So could the BBC kindly make more programs on this subject and lay out the impartial facts so the public can make the decision and see beyond the political ideology.

    It would be helpful if the BBC would produce a program that lays out the facts relating to our energy needs and its costs.
    As consumers it would be helpful to learn just what the real costs are and as taxpayers it would help us decide which political group is worth our support.
    One half hour program is simply not long enough to address all the issues.

  • Comment number 20.

    OK this programme was a bit biased but then Panorama usually is.
    I thought it was refreshing to see the BBC present this angle rather than the usual "we have to do this to save the planet" nonsense and propaganda.
    It's certainly true that we are paying for renewables subsidies on our electricity bills, through two mechanisms (renewables obligation certificates and feed-in tariffs) and a lot of people are not aware of this, because the government and much of the mainstream media (Grauniad etc) try to keep it quiet.
    So well done for raising this issue.

    And I agree with englishvote - if you want carbon-free electricity, the only answer is nuclear.

  • Comment number 21.

    Onshore wind costs are half that of offshore, and consequently compare very favourably with non-renewable energy options.
    Panorama seems to have gone out of its way to avoid mentioning the NIMBYs who regularly scuttle onshore developments at the expense of the rest of us.
    Of course it’s a difficult sell to portray groups of local activists as the bad guys, how much easier to go for the time honoured targets of politicians and big business.
    A prime example of lazy journalism.

  • Comment number 22.

    Opposition to wind turbines is growing not just because they are encroaching on peoples local environment but also because people are starting to realise that they are paying huge subsidies to wind operators to install massively inefficient white elephants.

    The very best wind turbines approach 30% efficiency, in other words produce just 30% of their installed electricity generating capacity. Most onshore turbines never get anywhere near 30% efficiency.
    When you consider that a large part of that 30% is actually generated in the small hours of the morning when there is no demand for it the lack of efficiency becomes simply absurd.

    But the subsidies are paid out for every KW generated regardless if the grid can use it or not.

    The taxpayers pay inflated energy bills because of wind turbines and solar panels even when the energy is not needed but when there is demand the wind turbines cannot be relied on to produce the energy so have to be backed up by conventional power plants.

    Every KW of installed wind and solar generating capacity will have to be backed up by conventional fossil fuelled generations. Not only is this massively expensive on top of the massively expensive renewable generation but it can’t be called green can it if we are still pumping out large quantities of CO2.

    On a freezing foggy November evening when you get home from work do you really want to sit in the dim light of a candle eating a cold dinner while looking at an energy bill that you cannot afford?
    This is the consequence of a renewable energy strategy, well no, sorry, of course you won’t be coming home from work because the energy prices would have got rid of your job.

  • Comment number 23.

    The Germans (and some French) have been actively been looking at different scenarios for supplying a majority or all of all their energy supply by renewables at cost comparable to or lower than the nuclear option frequently cited by 2050. Most of these options have been modelled using hour by hour simulations of the energy system.

    Whatever we do energy costs will rise as the majority of old central generating plant needs replacement in the near future.

    Gregor Czisch whilst at Kassel doing his PhD has also modelled a renewable
    energy network based on a HVDC super grid for Europe. This modelled a
    number of diffrent scenarios based on todays technologies to arrive
    at an economic cost via mathematical optimization. A CO2 neutral system
    based on renewables was found to be the lowest cost option for Europe.

    http://kobra.bibliothek.uni-kassel.de/handle/urn:nbn:de:hebis:34-200604119596
    http://nbn-resolving.de/urn:nbn:de:hebis:34-200604119596
    and english translation may be purchased at the IET Institute for
    Energy Technology
    http://www.theiet.org/resources/books/renewable/scenarios.cfm

    ++
    The Fraunhoffer Institute-IWES and ZSW - (Centre for Solar Energy and Hydrogen Research- Baden-Württemberg et al have been looking at the integration of all of
    the different renewable options and in particular using SNG Synthetic
    Natural Gas as an energy storage vector of excess renewable energy via electrolysis and methanation. CO2 + 4 H2 > CH4 + 2 H2O
    The CO2 is extracted from carbon fuel and methane burining forming a low carbon energy cycle.

    The whole system is based on energy efficiency, renewables and low carbon
    biomass cycles. The methanation cycle is just a part of the whole system but helps solve the problem of occasional intermittancy.

    http://www.brighthub.com/environment/renewable-energy/articles/78303.aspx

    Specht renewable power energy methane
    http://www.solar-fuel.net/fileadmin/user_upload/Publikationen/Wind2SNG_ZSW_IWES_SolarFuel_FVEE.pdf

    "Bioenergy and renewable power methane in integrated
    100% renewable energy systems" that modeled the German energy sector
    http://www.uni-kassel.de/upress/online/frei/978-3-89958-798-2.volltext.frei.pdf

    Solar Fuel (Fraunhoffer spin-off)
    http://www.solar-fuel.net/en/the-challenge
    +++
    Similar to the above The Negawatt Institute (France) Scenario 2011 proposal :
    http://www.negawatt.org%2Fscenario-negawatt-2011-p46.html

    ++++
    The SRU The German Advisory Council on the Environment (SRU) have also looked at linking Germany's energy system wih the Scandanavian system and in particular the Norwegian pumped hydro electric storage.

    SRU report Pathways towards a 100 % renewable electricity system

    http://www.umweltrat.de/SharedDocs/Downloads/EN/02_Special_Reports/2011_10_Special_Report_Pathways_renewables.html

  • Comment number 24.

    yes costs of gas and oil will rise but as far as wind replacing them - that isnt possible. you need the same and actually more conventional backup to compensate for the unreliability of wind. when you talk about wind as a power source you might aswell be talking about somebody peddling a bike. its completely useless and damaging to the environment aswell

  • Comment number 25.

    Renewables UK have made a rebuttal film to show some of the inaccuracies of this film, check it out here:

    http://green.tv/videos/how-bbcs-panorama-got-it-wrong-on-green-energy/

 

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