Energy capacity: Fast, cheap and out of control | The Economist

Energy capacity: Fast, cheap and out of control | The Economist:

A new energy bill is designed to stimulate some £110 billion ($176 billion) in new investment, largely by guaranteeing energy prices for different technologies, from wind to nuclear. This is meant to ensure a secure and less carbon-intensive electricity supply, as part of a pledge to obtain 15% of Britain’s total energy consumption from renewable sources by 2020. Yet the policy has left many questions unanswered, such as what these energy prices will be, how long contracts will last and how much energy will be needed.
Complicating matters, a fixed price for renewables—which are costly and intermittent—encourages companies to lobby for similar safeguards for more traditional sources of power, such as gas. This is because the market for all generators is being distorted. “Once you start meddling, you have to fix everything,” says Dieter Helm, an energy economist at Oxford University.

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