Expert comment: Mr Miliband is right to focus on building out a modern 21st century clean energy system at pace

“Britain is facing the biggest energy price shock in a generation. Sadly, we've been here before – and for the second time in less than five years, we are left to imagine how much more resilient the country would be now if we had moved faster in previous years.

Mr Miliband is right to focus on building out a modern 21st century clean energy system at pace, rather than lock us deeper into fossil fuel systems predicated on expensive and seemingly unending geopolitical conflicts.

It is also correct to say that the benefits of the clean energy transition risk accruing only to the richest in society. Our analysis shows that UK households already experience uneven retail electricity bills, with up to 15% difference by geographic location, and another 22% due to the choice of payment method or contract. This is why we need good policies designed to carry the most vulnerable households through the transition. 

Finally, by choosing to ignore the costs of inaction, as some are choosing to do, the reality of climate change – over which there is an established global scientific consensus – also risks being ignored. Oxford research has shown how dangerously unprepared the UK is for climate impacts like heatwaves, fires and floods. Britain's global leadership matters more than ever when nearly half of the world's population will be exposed to extreme heat if the world passes 2 degrees of global warming.”

“The proposed plans don’t immediately sever “the influence” of gas on electricity prices  – they are more of a long-term nudge. But they do demonstrate a serious intention to cap or lower bills.

The further measures announced today are surely welcome, particularly on helping households move off LPG to electricity via the Boiler Upgrade Scheme, housing upgrades on warm homes plan, and public procurement (though it must be noted that most of these have already been announced and take years to implement, particularly on the warm homes front). 

In the shorter term, it would be good to see the Government take immediate measures to help households, including social tariff to protect vulnerable households through this crisis and a meaningful clawback of windfall revenues (not just increase on tax levy) used to offset any price cap increase with the next Ofgem review.”

"Contracts-for-Difference (CfDs) for clean energy technologies awarded through well-designed competitive auctions can deliver two outcomes in the medium term: first, they can scale up clean power quickly and lower wholesale electricity prices, while providing a predictable revenue stream to generators. And second, when fossil fuel driven electricity prices spike above the competitively-determined ‘strike price’ in a CfD, generators with CfDs pay the difference in price into government coffers. In practice, consumers may not see the benefits from renewable CfDs, due to electricity market design and regional and structural inequalities in UK electricity bills. In the longer-term, there is a possibility that CfD plants may continue to receive fixed prices for clean power long after renewables have brought down the costs of electricity. However, procuring clean energy through CfDs remains a far preferable option now to continuing with volatile fossil fuels in terms of medium-term price stability, and we need good policies to ensure that any impact on vulnerable consumers, current and future, is managed well as we move through to a clean energy system fit for the 21st century."

The Smith School of Enterprise and the Environment at the University of Oxford equips enterprise to achieve net zero emissions and the sustainable development goals, through world-leading research, teaching and partnerships.