December 3, 2012 11:35 pm

Focus on gas plants angers green lobby

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The government is set to announce that gas-fired power could account for half of generation capacity by 2030 – a target that will infuriate green campaigners who want greater use of renewables.

Ministers will say on Wednesday that 26 gigawatts of new gas-fired power capacity will be needed by 2030, with most of that replacing nuclear and coal-fired plants that are due to be closed down in the next few years.

The figures will be announced in the government’s gas generation strategy, published alongside George Osborne’s Autumn Statement.

However, the strategy will say gas could potentially play an even bigger role in the energy mix. If the fourth carbon budget – which sets out carbon emission targets – is revised up, the government will argue, the amount of power generated from gas by 2030 could be 37GW – equivalent to almost half the country’s power generation capacity, according to a person familiar with the matter.

The inclusion of such a target will reinforce the impression of a new dash for gas and a downgrading of the UK’s commitment to renewables such as wind energy.

Gas goes to the heart of the dispute between Mr Osborne, the chancellor, and Ed Davey, energy secretary, over energy policy – a dispute that has shaken the coalition as it seeks to reform the electricity market and attract £110bn into the energy infrastructure.

Mr Osborne has insisted gas must continue to play an important role in the energy mix to 2030 and beyond, and in October promised generous tax subsidies to the shale gas industry. The Liberal Democrats put more emphasis on nuclear and renewables.

The coalition split was laid bare in the autumn when Conservative energy minister John Hayes said “enough is enough” on onshore wind farms, only to be slapped down by Mr Davey. The two sides settled their row last month when the Treasury agreed to £7.6bn of support for clean energy by 2020 – more than triple the current level – with costs being passed on to households and companies through energy bills.

Mr Davey, meanwhile, dropped the Lib Dem demand for a 2030 target to decarbonise the electricity sector, a move that angered environmentalists and some advocates of renewable power.

The fourth carbon budget covers the period 2023-27. It reflects advice from the Committee on Climate Change, a statutory body, which said carbon emissions should be cut by half on 1990 levels by 2025.

Disagreement broke out over the budget last year, with Vince Cable, business secretary, expressing concern that the targets it contained could damage Britain’s competitiveness. In the end, the government agreed to review the carbon budget in 2014.

The gas strategy will also back the development of the UK’s shale gas reserves, creating an “office for unconventional [shale] gas”. It will provide a single point of contact for investors and streamline regulation of the industry.

The energy department said the 26GW of new gas capacity needed by 2030 would replace power plants and that there would actually only be 5GW of new gas capacity. It also insisted that the 26GW was consistent with the UK decarbonising its power sector by 2030.

However, Joss Garman, political director of environmental group Greenpeace, said: “A big jump in our reliance on burning gas to generate electricity would expose families and businesses to rising gas prices, damage investor confidence in Britain’s low-carbon industries and jeopardise legal commitments to cut carbon emissions.

“Coming just a week after the energy secretary said Britain’s energy future would centre on a shift away from fossil fuels, this is just the latest confusion over energy policy from a government that can’t seem to speak with one voice.”

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