By Paul Goodman
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The nub of the Osborne/Davey clash is that the Chancellor believes that in the balance between lower energy bills and lower carbon emissions the former should win out. He wants to link the renewables policy to decisions on gas so that there is “a credible and certain framework” for investment in both. The Energy Secretary accepts the case for a ten per cent cut in the subsidy for onshore wind farms; Mr Osborne wants a bigger reduction.
His leadership ambitions will want to march in step with the instincts of Conservative MPs; a hundred of them recently signed a letter urging cuts in onshore wind farm subsidies. Mr Davey is fighting his corner for LibDem activists; as a separate piece in the F.T today notes, unless gas plans can "be fitted with still-nascent carbon capturing technology, the UK could miss its climate targets".
As I have pointed out before, the Energy Secretary's own Climate Change Calculator demonstrates that if Britain's energy needs are to be met and emissions reduced – and security of supply buttressed – there is no substitute for a big expansion of nuclear power: shale gas should also have a role to play. Tony Lodge has argued recently on this site that "the priority should now be to deliver the new build of atomic plants and to re-examine a carbon price floor which will prematurely force coal out and encourage a greater reliance on gas than relative prices warrant".