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Renewables Obligation (Amendment) Order 2010

I do not disagree. The term "state aid" is almost a term of art that is used in Europe. All of us in this Room understand how the scheme is funded. We do not deny that driving up the deployment of renewables in this country will incur costs for consumers. However, I hope that all Members of the Grand Committee, with the possible exception of the noble Lord, Lord Stoddart, will accept that a reduction in the risk of catastrophic climate change and dangerous energy insecurity is the alternative to the move towards renewables. Those risks carry real and much higher costs than the increase in consumer prices which the renewables deployment will cause. The report by the noble Lord, Lord Stern, showed that the damage caused by global climate change could cost five times more than the cost of action to stabilise global emissions by 2050. The Government believe strongly that the cost of meeting our renewables target should be seen as an investment to avoid much higher costs to the economy in the long term. Members of the Committee asked for the figures for the RES on the impact of the measures to achieve about 30 per cent renewables electricity by 2020, covering large and small-scale generation. We estimate that under central fossil fuel prices, domestic electricity bills will be £77, or 15 per cent, higher than they would have been in the absence of the RES. The costs associated with the measures in the RO are expected to increase domestic bills by 12 per cent in 2020. For FITs, the latest estimate is £11—again, by 2020. Returning to co-firing for a moment, I was asked about discussions with Ofgem. Ofgem has responded to consultations on that in the past. It is of the view that the cap should not be removed. As I said a moment ago, we take the view that we need to keep the matter under review and will look at it in the round.