Energy bill to boost clean energy production

The bill is expected to outline long-term contracts to encourage investment in nuclear and renewable energy.

These could include provisions for energy firms to return money if energy prices rise above agreed levels.

Critics say the measures will result in higher energy bills for consumers.
Green groups also say the bill will not reduce the UK's reliance on gas.
They say that more clarity is needed over the government's long-term policy, particularly how it will achieve stringent C02 reduction targets.

The bill should provide more details of the coalition's plans for nuclear power generation, which are unclear following the decision of two German power companies to pull out of building plants in the UK.
Dirty plants The long-term contracts, precise details of which are unlikely to be outlined in the bill, aim to reassure prospective investors in nuclear and offshore wind farms, which need huge up-front expenditure.
But they have proved unpopular with some energy suppliers, which say basing them on the difference between the actual market price and a preset, guaranteed price, is overly complex.

Other industry bodies have also expressed concerns about the so-called contracts for difference.

"Investment decisions for both developers and manufacturers need to be made a long time in advance and it's key that they get reassurance and understanding of how the market will allow generators of all sizes to produce and sell power," said Renewable UK's director of policy Dr Gordon Edge.

The government will also introduce an Emissions Performance Standard, designed to prevent the construction of new, dirty coal plants.

Only coal plants with carbon capture and storage will, in effect, be allowed, although this technology is unproven on a large scale. Read More