According to the Public Accounts Committee (PAC), in their snappily titled report ‘Offshore electricity transmission-a new model for infrastructure’, the cost of laying the cables which will transmit the energy created by new offshore wind farms to the Grid is £8bn, but the ultimate cost to us (the consumers) could be as high as £17bn. Why?
Well, the £8bn isn’t being paid out of public money or via our energy bills. Instead private investors, who bid to take on the new transmission licenses, will cover the cost.
Don’t breathe a sigh of relief though, because according to the PAC, the terms of these licenses mean that in return, these investors will get payments of around £17bn, which will come from our energy bills, and inevitably could mean a rise in energy prices.
Margaret Hodge MP, chair of the Public Accounts Committee, said:
“Not only is it unlikely that this new licensing system for bringing electricity from offshore wind farms onto the national grid will deliver any savings for consumers, it could well lead to higher prices.”
She added:
“the terms of the transmission licences appear to have been designed almost entirely to attract investors at the expense of securing a good deal for consumers. Licensees and their investors are provided with a guaranteed income, increasing annually in line with RPI, for 20 years regardless of the extent to which the assets are used.”
A worrying portent of things to come to a business energy bill near you.
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