Subsidy support is now conditional on grid capacity and bill reductions, not on generation volumes alone.
John Healey has said he will veto new offshore wind projects if they will not lower bills, according to The Guardian. The chancellor's announcement adds to concerns that the government is moving away from a pro-renewables agenda, the paper reports.
Writing in the Times, Healey said clean power is "how we break the grip of international gas prices on our bills", but argued the shift "has to come at the right pace, in the right places, with the grid to carry it". Under his plans, new offshore wind projects bidding for subsidy contracts would be signed off by ministers only if they believe all the power generated could be accommodated by Britain's electricity grid without pushing up costs for consumers. Healey put it plainly: "There's no sense building power that can't connect and then paying to switch it off." The approach, he said, will be taken into the next renewables auction, with the government "only buying projects that can lower bills while strengthening our energy security".
The stated rationale is the cost of constraint payments. The National Energy System Operator, which is funded through energy bills, must pay wind turbines to switch off when there is insufficient cabling capacity to transmit their power to consumers. According to The Guardian, a National Audit Office report in September warned that homes and businesses could face a potential annual bill of £7.8bn by 2030 to deal with the issue.
The announcement follows budget cuts that have alarmed renewables specialists. Healey revealed more than £3bn of cuts to the energy department's budget this week, much of which will pay for higher defence spending. The paper reports that £741m will come from the boiler upgrade scheme, the programme incentivising households to replace gas boilers with electric heat pumps. A typical household can claim £7,500 towards a heat pump, with about 60,000 a year being fitted in existing homes; the government targets 250,000 a year by 2030 and had planned to raise scheme funding from £400m this year to just over £700m by 2029-30. Experts quoted by the paper warned the cuts made green heating targets unlikely to be met, and the measures were seen as a dismantling of former energy secretary Ed Miliband's green agenda.
Healey pre-emptively rejected that reading. "This is not a retreat from clean power. It is the credible route to it," he said, adding that without recent renewable generation this year's gas price shock "would have hit families and firms even harder". Allies of Miliband and his successor, Miatta Fahnbulleh, insisted the green agenda remained as strong as ever, pointing to Healey's long-term move to shift green costs from bills to taxpayers.
What is not yet confirmed is how ministers will judge whether a project can be accommodated without raising costs, and which schemes might fail that test. The report gives no figures on the pipeline at risk, and no detail on how the next auction rules will be drafted. The direction of travel, however, is clear: subsidy support is now conditional on grid capacity and bill reductions, not on generation volumes alone.
