Energy Secretary Ed Davey has today unveiled eight new major renewables projects which he says will be funded by £12 billion of private sector investment to “boost green growth and green jobs“. Renewable projects are guaranteed a price for the power they produce, meaning that the difference between the guaranteed price and the price on the market is subsidised by the taxpayer. Guido has been crunching the numbers to work out how much the subsidy for these new projects will cost taxpayers overall.
The wholesale price for power for winter 2015 is £53 per MWh. There are 5 offshore wind projects totalling 3,184MW, each guaranteed £140 per MWh if completed in 2017-18. That’s a subsidy of £87 per MWh.
If wind farms generate 35% of the time, that’s 3,066 hours per year. At £87 per hour on 3,184MW of capacity that’s a subsidy of £849 million.
There is 1 Biomass CHP project providing just 299MW. This is guaranteed £125 per MWh. A subsidy of £72 per MWh.
If this generates 85% of the time, that’s 7,446 hours per year. At £72 per hour on 299MW of capacity that’s a subsidy of £160million.
Then there are 2 Biomass Conversions totalling 1,065MW. These are guaranteed £105 per MWh. A subsidy of £52 per MWh.
If these generate 85% of the time, that’s 7,446 hours per year. At £52 per hour on 1,065MW of capacity that’s a subsidy of £412 million.
Overall, that is a total subsidy of £1.4 billion per year.
Davey said today that the new contracts for renewable projects will support 8,500 green jobs. At £1.4 billion, that amounts to £167,000 per green job. Or green crap as the PM likes to call it.