Magazine article Public Finance

MPs Slam Cost and Poor Targeting of DTI Green Energy Policy

Magazine article Public Finance

MPs Slam Cost and Poor Targeting of DTI Green Energy Policy

Article excerpt

The Department of Trade and Industry has been severely criticised over its scheme to promote renewable energy, which senior MPs say will cost consumers an extra E5bn by 2010.

The criticism, from the Commons' Public Accounts Committee, came as Chancellor Gordon Brown, in his speech to the Trades Union Congress in Brighton, was restating his commitment to alternative energy sources.

Brown called for greater effort to be put in to developing more environmentally friendly alternatives to traditional energy. The call came as renewed protests over petrol costs led to panic buying of fuel by motorists.

In a report published on September 15, the PAC attacked as expensive and poorly targeted the DTI's directive to electricity suppliers to increase the percentage of their sales from renewable sources - the Renewables Obligation.

PAC chair Edward Leigh MP said: 'Consumers are providing a massive subsidy to the renewables industry. But, unlike public expenditure, this subsidy does not receive annual scrutiny by Parliament. This is unacceptable.'

The PAC report notes that the DTI scheme pushes up the demand for renewable energy and subsidises its development, at a likely cost of more than £2bn by 2010. …

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