Energy outlook 2012: 12,000 jobs from wind power, but higher bills for drivers

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Chris Huhne used the Christmas break to announce that UK companies plan to invest almost £2.5 billion in renewable energy projects in the UK in 2012, while energy minister Charles Hendry announced the awarding of 46 new licenses to explore for oil and gas in the North Sea. The £2.5 billion investment in renewables, which has the potential to create almost 12,000 jobs across the country according to Huhne, is up from last year's £2.1bn.

However, investments are down from 2009, when a record £7.1bn was put into renewable energy.

Shadow energy secretary Caroline Flint MP commented: "The UK has fallen from third to 13th in the world for investment in green growth, behind countries like Brazil and India".

The UK also had a 27% increase in renewable energy consumption from 42.6TWh in 2008 to 54TWh in 2010, according to EU figures, but this still only accounted for 3.3% of the total energy (electricity, heat and transport fuel) consumed.
Greater dependency on imported energy

The oil and gas exploration awards were made as part of the 26th offshore oil and gas licensing round.

They come in the context of the latest Energy Trend figures, which show that indigenous fuel production in the UK fell by 19.2% in the third quarter of 2011 compared with a year earlier, the largest annual quarter on quarter fall ever.

Production of oil fell by 22.7% whilst gas fell by 29.4%, as a result of maintenance work and slowdowns on a number of fields, according to the statistics.

Charles Hendry, minister for energy, said: “Oil and gas remains crucial to the UK economy – contributing around 2% to the country’s GDP. Our innovative licensing system continues to make the UK one of the most attractive places to do business."

Total energy production fell by a record 19.2% in the third quarter of 2011 compared to the third quarter of 2010.

This did not stop there being a record dependency on imported energy, which came to 42.2% of the nation's total energy in that quarter.

In some good news, the prices industry pays for electricity fell in real terms, in the third quarter of 2011 by 1.5% including the Climate Change Levy (CCL) and 1.7% excluding CCL.

On average, the CCL adds only 0.1% to fuel prices, the figures reveal.

Average gas prices rose by 17.9%, oil by 21.2% and coal by 12.5%.

This helps to confirm research by the Committee on Climate Change that 64% of energy price rises are caused by increasing wholesale energy prices, with only 6.5% of the price rise caused by government support for low-carbon energy.

The use of biofuels in transport is rising, from 1% of total road transport fuel supply in 2007/8 to 3.9% in quarter three of 2011.

The figures also show a growth in the UK’s installed capacity to generate electricity from renewable sources of 400 megawatts in the third quarter of the year, 12% higher than a year earlier.

In the third quarter of 2011, renewables' share of electricity generation increased by 0.9% to 9.0% (7.45TWh) compared to the same quarter in 2010.

This is largely accounted for by increased hydro (one third) and wind (two thirds) generation due to the rainier and windier weather, and by the first turbines of the Ormonde and Greater Gabbard offshore wind farms beginning operation.

The UK now has enough installed capacity to supply more than 3,300,000 homes from wind energy.

The figures were welcomed by Dr Gordon Edge, RenewableUK’s director of policy, who said they were “proving that despite the anti-wind propaganda being spouted by lobbyists with their own particular agendas, wind turbines are continuing to generate increasingly large amounts of electricity for the UK’s households".
Bad news for drivers and consumers

However, drivers are less pleased, with the UK retail price of diesel at the end of the year the highest in the EU-15, and that of petrol the sixth highest.

The price difference in Britain between diesel and petrol is now 8.4 pence per litre, the highest level since March 2009.

The cost of all fuel, for heating, electricity and transport, for consumers went up by record amounts in the year as well, rising by 8.7% between Q3 2010 and Q3 2011.

This put an average £38 when the average electricity bill, and ￡62 on the average gas bill.

Bad as it is, it is not so bad when compared with the rest of Europe. For the period January to June 2011, prices for medium domestic gas and electricity consumers in the UK, including tax, were the lowest and third lowest in the EU-15 respectively.

Source- Link2Portal