3rd September 2015
Back in 2010, as Energy Market Reform (EMR) was getting going, I proposed a 2-stage auction as a way of combining mechanisms for meeting the carbon targets with the maintenance of a sufficient security margin. The first stage would be open to all, and the second constrained to meet the carbon budget if necessary, and if the carbon price is insufficient. Instead, EMR followed a complex path, with Feed-in-Tariffs (FiTs) to replace the Renewable Obligation Certificates, limited by the Levy...
24th August 2015
Amber Rudd, the Secretary of State for Energy and Climate Change, has had a very busy start. She has ended new subsidies for onshore wind, reined back the Green Deal, removed the exemption from tax for renewables, ended the zero-carbon homes plan, removed guaranteed subsidy for biomass, borne down on solar PV subsidies, speeded up the rules on fracking planning process, and at the same time fully come in behind the Paris climate negotiations and the UK’s commitment to tackling carbon emissions...
20th July 2015
When, in the face of the sustained attacks from Labour’s Ed Miliband and Caroline Flint, OFGEM referred the electricity industry to the Competition and Markets Authority (CMA), many hoped the result would settle the controversies once and for all, restoring trust and putting the industry on firmer foundations. The CMA has now spent a year investigating the electricity market, and come up with its preliminary findings, and proposed remedies. Unfortunately these fail to convince on most fronts:...
16th June 2015
Ed Miliband may have been vanquished by the electorate, but one of his legacies lives on. As the first DECC Secretary of State, he is the architect of Energy Market Reform (EMR), and a return to a state-driven energy policy. His now largely forgotten speech to at Imperial College “The Rise and Fall and Rise again of a Department of Energy”, in 2008 set out explicitly to change direction from the path followed since the 1982 Speech by Nigel Lawson on “The Market for Energy”. Indeed Miliband...
12th May 2015
Catchment management, abstraction and flooding: the case for a catchment system operator and coordinated competition
7th May 2015
Since 2010 there have been a number of piecemeal reforms and developments across the water sector. These have included: the periodic review of the water and sewerage companies; the provision of further financing for the Environment Agency to address flood defences over a slightly longer period; a deal with insurance companies on flood risk; steps towards retail competition in water; and changes to the form and scope of agricultural subsidies for environmental improvements. It is widely...
20th April 2015
A growing band of economists and geographers have been arguing the Green Belt is no longer fit for purpose and that it should be opened up for housing development. The argument is based upon a chain of assertions and purports to be based upon sound economic arguments and empirical evidence – all of which are questionable, and some of which are wrong.
16th April 2015
When the great utilities were being privatised, one of the key objectives was to establish a regulatory regime which would be credible to investors and fair to customers. The way it worked was that the companies would be given fixed contracts ex ante, and these would be reset on a periodic basis. Within the period, prices would be fixed by an RPI-X formula. The logic was very clear: the only way in which the performance of the companies could be improved was to incentivise them to do so. Fixed-...
26th March 2015
The Coalition came to power with a ready-made energy policy developed under Labour. The Secretary of State was Ed Miliband, and his policy as it played out under the Coalition was to prove the basis of a return to a level of state intervention not seen since the days of the CEGB, British Gas and the nationalised industries. By the general election in 2015, the almost complete U-turn had been completed, abandoning most of the liberalised and competitive structures that had been the hallmark of...
26th February 2015
Imagine you are chief executive of a major oil company. Your economic forecasts tell you that the world remains stubbornly on a fossil fuel path for decades to come. The world is going to need you. But your forecasts also tell you that the result will be emissions that push up way beyond the level that your scientists tell you will limit global warming to two degrees. The world is on a path to burn all the oil you can find, and your oil will contribute to serious global warming. What do you do
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