BBC Still Ignore The Elephant

By Paul Homewood

 

https://notalotofpeopleknowthat.wordpress.com/2025/04/16/bbc-ignore-the-renewable-elephant-in-the-room/

You may recall this item on World at One a couple of months ago. Sarah Montague interviewed a renewable industry lobbyist, Adam Berman, on the question of why UK electricity prices are so high.

I covered the story here.

Berman claimed that the principal reason was the high price of gas, exacerbated by the energy market mechanism which normally sets the wholesale price on the price of gas power. This supposedly stops consumers from benefitting from what he calls cheaper renewable energy. His claims went unchallenged by Montague.

I complained to the BBC that Berman’s claims renewables were cheaper, and that the principle reason why electricity prices are so high is that they are loaded with close to £20 billion of subsidies for renewables and other associated costs, such as system balancing.

I received this ludicrous reply:

Thanks again for contacting us with your concerns about the interview with Adam Berman Director of Policy at Energy UK (trade body for energy firms) on The World at One programme broadcast on 14 April. Please accept our apologies for the delay in responding.

We’ve shared these with the programme editors and senior news managers.

We’ve sorry you are disappointed with our first reply.

Listeners were informed about the premise of the interview which was to explore specifically why energy bills (principally for industry) are so expensive compared to other countries.

In answer to your comments about the broader costs of green energy – this didn’t fall within the narrow scope of what we were discussing here. 

Our presenter raised the comparison with Germany where energy bills are cheaper but where there is a similarly ambitious target to reach net zero. In other words, even setting aside the capital costs for low carbon energy, why is the UK still more expensive than its peers? That was the focus of our interview. 

It is worth adding that Adam Berman did also explain that there is a mechanism to recoup some of the profits which green energy companies make, but that the government does not choose to hypothecate that money to reduce the cost of bills. 

Therefore, we believe our listeners would have come away from the interview understanding that government policy also contributes to the relative cost of energy.

We believe pertinent questions were put to Adam Berman given his experience of the market. 

In true BBC style, the response did not address my complaint, so I have now upped the complaint to the ECU, with this:

Your two responses do not address my central complaint, ie that claims that renewables are cheaper than gas and that UK high electricity prices are largely due to the high price of gas.

Your response talks about “narrow scope” – but the issues I have raised actually go the very heart of the interview – why are prices so high.

Your response also mentions prices in Germany, but this is a red herring – German industries are exempt from the Renewable Energy Sources Act (EEG) surcharge, which funds renewable energy expansion. Instead all of the cost is loaded onto domestic users. (See here: https://www.bundeswirtschaftsministerium.de/Redaktion/EN/Artikel/Energy/electircity-price-components-state-imposed.html) That is why electricity prices for domestic users are as high in Germany as here.

As I pointed out, the main reason why UK prices are so high is the subsidies paid to renewable energy. This year subsidies and other associated renewable costs (such as providing standby capacity) are estimated by the OBR to add £17.1 billion to bills : https://notalotofpeopleknowthat.wordpress.com/2025/03/27/environmental-levies-will-cost-95-billion-in-next-five-years/

In addition can be added the costs of grid balancing, needed to cope with intermittent wind and solar power, costing £2.6 billion this year : https://notalotofpeopleknowthat.wordpress.com/2025/06/26/grid-balancing-costs-hit-2-6-billion-a-year/

Any discussion of high electricity prices should have focussed on this factor, as it dwarfs other factors. It is also untrue that renewables are cheaper than gas. The CfD scheme continues to pay out billions every year in subsidies for renewables, which top up the market price they receive to a guaranteed strike price. (This is why renewable generators always undercut gas in the market – they know they will receive the higher price anyway) For details of CfD, see here, under Green Energy Support. https://data.spectator.co.uk/energy

Similarly other renewable generators not in the CfD scheme receive subsidies worth £8.2 billion this year via the Renewable Obligations Scheme, on top of the market price they are paid.

The interview referred to the windfall tax – however according to the OBR, this will only raise £700 million this year, and £100 million. In other words, it is chicken feed beside the billions paid out to subsidise renerwables. (see here: https://obr.uk/efo/economic-and-fiscal-outlook-march-2025/

• Table A5, page 162)

Listeners have been misled on two counts:

1. That renewables are cheaper than gas

2. That high electricity prices are largely the result of the cost of gas

Neither claim is true. If there were no renewables on the system, electricity bills would be about £20 billion lower a year. The electricity market is valued at around £70 billion, so bills would be about 30% lower without renewables.