Labour’s upcoming AR7 renewable energy auction risks locking in higher energy costs for decades, as political support for net zero falters and public resistance to green subsidies grows, says Maurice Cousins

Today applications open for the government’s latest renewable energy auction, Allocation Round 7 (AR7). In Whitehall, it is just another technocratic acronym. But for Ed Miliband and the climate lobby, this auction is make-or-break. Energy UK, the industry’s main trade body, has called AR7 “critical” to delivering Labour’s pledge of a clean power system by 2030. Offshore Energies UK says it must be the largest round of investment yet “to keep the dream alive”.

And what a costly dream it is becoming.

In a bid to entice developers, Labour has quietly raised the maximum price it is prepared to guarantee for offshore wind. These so-called Contracts for Difference (CfDs) are meant to provide investor certainty and keep costs down. In reality, they are fast becoming a blank cheque drawn on the wallets of British households and businesses.

To further sweeten the pot, Miliband has extended the length of the contracts from 15 to 20 years.

This giddy response from ministers reveals just how fragile the subsidy model for intermittent energy has become

This giddy response from........

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