A recommendation from The EU Commission could soon look to be upheld which looks to cut government aid to altogether to renewable incentives. Although not set to be an immediate cut off the recommendation looks to make this a progressive measure which will look to phase out subsidies over time. In recent months there has been mounting criticism from energy monitors and tax payer alliances within the UK about the subsidies that UK homeowners support directly from their house hold electrical bills. Although this represent a minimal percentage from the homeowner this has still caused unrest with a vast amount of consumer not realizing that they were included.
Depending on which side of the energy debate you lye has had obvious reaction on the solar pv / wind side of the argument are the providers who say that they need the energy production subsidies to continue to grow their market and create a push towards a more sustainable future. But when you consider they are receiving approx £90 per mega watt compared to approx £55 per mega watt from conventional sources you can then understand why energy firms who haven’t invested in green project are perplexed and welcoming of the decision.
It appears that the EU has taken notice of this not only in the UK but also warning other governments that a reduction firstly of such resident induced subsidies need to be halted with the long term recommendation looking to reduce high government grants and subsidies. There has been mixed reaction in the UK to the European Commission involving in itself in government spending but with many ministers feeling the wrath of constituents they are looking to be more accommodating than usual on this particular topic.
A total phase out of the subsides by the end of the decade is an aim that the ECC (European climate action commissioners) are aiming for with a large degree of their recommendation being founded on that solar panels and other industries aren’t as innovative as they once were and they should now be looking to operate by themselves without the continued support from governments and bill paying induce payments. While the ECC have analyzed the industry in the past continued government intervention to support the market does go against their single market rules which has now led to the recommendation be issued. While at the moment it has forced the issue with the EU their guidelines clearly state government can not supply long term sate aid to domestic industries that otherwise would still be able to operate without their support. This a particular pint for notice but the ECC also points out that this issue with the bill payer subsidies has brought about a need for change.
Time will tell the impacts the impending review will have to the industry with different countries with different points of view and public support welcoming the possibility of cheaper bills any definitive policy change may take longer to bring to effect that than the ECC would like.
The most likely outcome may possibly well be a pleasing of both parties thus meaning that although the government help would not cease it would likely be to a much more lesser extent. This in turn increasing competition from current green energy suppliers as the subsidy reserve shrinks and they work harder to retain their current benefits while at the same time inducing a reduction to fellow organizations.
Some previous related articles of interest:
Agricultural solar power generation continues to grow, why?
A look into how the Scottish renewable sector continues to increase uptake ## Scotland
A look into the western worlds energy habits