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£40 Billion: The Real Cost Of Going Green

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Danny Fortson, The Sunday Times

BRITAIN can hit its targets for reducing carbon emissions and spend £40bn less than envisaged if it embarks on a new “dash for gas”, an influential consultancy has claimed.

Pressing ahead with the current plans for investing in renewables and nuclear energy risks burdening the struggling British economy with unnecessarily high energy bills, the report by AT Kearney adds.

The research, to be published this week, recommends instead investing in a new fleet of efficient gas-fired power stations.

The advice comes at a crucial juncture for the government’s controversial proposed £200bn low-carbon makeover of the power industry. This week the Energy Bill will have its third and final reading in the House of Commons before passing to the Lords. It is expected to receive royal assent by the year-end.

The bill is the centrepiece of the coalition’s ambitious scheme to replace old coal-fired power stations with low-carbon alternatives. To guide the revolution, the bill proposes huge subsidies for renewable energy and penalties for polluters that would be in force for decades.

Ed Davey, the energy secretary, said: “The Energy Bill will lead to a massive decarbonisation of the power sector by 2030, and will enable the UK to cut its emissions by 50% by 2030.”

To hit a binding target for increasing the share of electricity generated from renewables by 2020, AT Kearney estimates that companies will have to spend £72.7bn building and operating new plants, mostly wind farms. That compares with the £32.5bn cost of new gas-fired power stations that would release half the emissions of coal-fired stations.

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