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Ed Miliband’s £296 billion clean energy bill doesn’t add up

Should Britons trust Miliband's promises of cheaper and more secure energy? Credit: Getty

November 8, 2024 - 7:00am

Energy Secretary Ed Miliband loves making videos and posting them on X. Having promised during the election to save households £300 a year by creating a Net Zero electricity network by 2030, he did it again on Tuesday, saying he had just been given the “expert verdict on our clean power mission”, confirming that “clean power by 2030 is not only achievable but can lead to cheaper and more secure electricity” while generating “wealth” and thousands of new jobs.

Under close analysis, these bold claims are starting to fall apart. UnHerd has already pointed out that the expert verdict to which Miliband referred, a report from the National Energy System Operator (NESO), says achieving this goal would require investment in “clean” energy of well over £40 billion each year — around four times the sum invested in the period 2020-24, a total of between £260 and £296 billion.

Miliband has persuaded Chancellor Rachel Reeves to increase his department’s budget from £6.4 billion in 2023-4 to £14.1 billion in 2025-26, but a further rise of more than £26 billion is clearly out of the question. NESO’s answer is that, somehow, these vast sums can be acquired from the private sector.

However, there is mounting evidence that more than £40 billion a year is an underestimate. The sums set out in NESO’s report assume that the cost of building offshore wind farms, which must be rapidly and massively stepped up, is about to plummet by 50%, to a bargain £1.5 million per megawatt of generating capacity.

Yet documents revealed by the campaign group Net Zero Watch suggest this is not going to happen. The developers of Moray West, one of the biggest projects being constructed off the coast of Scotland, have already spent £1.4 billion just on its foundations, the equivalent of £1.6 million per megawatt.

Further flaws have been identified by the energy expert David Turver. According to NESO, residential demand can be cut by a fifth, helped by what is known as “demand flexibility”. This would mean energy rationing, probably using powers granted under the 2023 Energy Act that allow Miliband’s officials to turn off “smart” appliances such as fridges, washing machines and heating.

NESO says that Miliband’s “clean energy superpower” will also have to rely on ancient nuclear power stations whose operational life has already been extended several times, as well as the hope that the new Hinkley Point C reactor, which has been hit by numerous delays and technical problems, will be up and running. Its owner, EDF, originally promised it would be finished by 2017, and earlier this year said it would be supplying power to the grid by 2031, not 2030.

As for NESO presenting a supposedly independent verdict, it should be borne in mind that NESO is not independent of Miliband at all. Spun out of the National Grid after Labour’s election win, it is a limited company with one “active person with significant control”: Ed Miliband, who has the power to hire and fire its senior staff.

Claire Coutinho, Miliband’s predecessor as energy secretary, highlighted further concerns in a thread on X this week. To connect new renewable energy plants to the grid will require twice as many pylons, cabling and underground power lines to be built on time in the next five years as has been managed in the last 10. If this fails, consumers will have to fork out billions in “constraint payments” to operators whose power is not even being used.

NESO and Miliband, Coutinho pointed out, claim that bills would be protected from surges in fossil fuel prices. Yet the Government’s Office for Budget Responsibility recently predicted that the price of gas is set to fall, further undermining his assertion that the vast investment needed to make his dream real will eventually save consumers money.

Finally, there is the weather. This week, Britain and all of Europe have been living in what the Germans call a Dunkelflaute, a period when little or no energy can be generated by wind or solar because the air is still and the sky cloudy. For example, at 7pm on 5 November, renewables supplied less than 5% of the UK’s electricity demand. The lights are on only because we still have gas-fired power stations, most of which will be closed by 2030 under Miliband’s plans. NESO says battery capacity needs to be increased by more than 800% to fill the gap caused by such events, but the charge in grid-scale batteries lasts at most a few hours.

Another idea for energy storage is to use hydrogen, made by using excess power generated in periods of plenty to electrolyse water into its constituent elements, hydrogen and oxygen. But although the Government has said it will spend £500 million on developing this technology, there is no possibility of it being ready on a large scale for many years.

The prospect, according to Coutinho, is that when we head into the 2029 election, “Ed will be asking the equivalent of 10 million homes to use energy not when they need it, but when the wind decides to blow. I don’t think anyone in this country would define that as energy security.”


David Rose is UnHerd‘s Investigations Editor.

DavidRoseUK

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Steven Carr
Steven Carr
12 days ago

‘This would mean energy rationing, probably using powers granted under the 2023 Energy Act that allow Miliband’s officials to turn off “smart” appliances such as fridges, washing machines and heating.’
Milliband thinks that if I turn off my gas central heating, that will make a big difference to my electricity use?
How does that work?
If I have to turn off my fridge for 6 hours, should I send Milliband a bill for the wasted food?

‘NESO says battery capacity needs to be increased by more than 800% to fill the gap caused by such events, but the charge in grid-scale batteries lasts at most a few hours.’

No, you need battery storage for a few weeks, at least 4, not a few hours.
If batteries are being discharged at grid-scale for , say, 5 hours, it will take at least 20 hours to recharge them, because they won’t be recharged at grid-scale. They can only be recharged with excess generated power, which at most will be 25% of grid-scale (and almost certainly less).
That means that next day you will have no battery power….
And if the Dunkelflaute lasts more than a week, you will need 4 weeks at least to recharge the batteries, during which time you will have no backup.
Net Zero would be total catastrophe for Britain.

Nell Clover
Nell Clover
12 days ago
Reply to  Steven Carr

Net zero is already a total catastrophe for Britain. We now have the most expensive electricity in the developed world. That is impoverishing every one of us and destroying high value employment in finance, technology and traditional industries alike who all need access to large amounts of cheap electricity.

Caradog Wiliams
Caradog Wiliams
12 days ago
Reply to  Steven Carr

I have worked in batteries for many years. The Li-ion battery is really the only newish tested invention and that depends on a source of Lithium. Admittedly, there are other new battery systems around but they are far from mass use. When I worked for Chloride Batteries in 1978 they boasted of their fleet of delivery vans in London. 46 years later, this has happened. That was, of course, the old lead acid battery technology.
Batteries will not be the solution for another 50 years, if ever, because they rely on chemical reactions which are too slow. This tells me that Mr Miliband and advisors don’t understand the problems but they are using the old management technique of rushing about with more energy because they believe that people are dragging their feet. More energy means faster results.

Susan Grabston
Susan Grabston
12 days ago

Well said. No expert but done plenty of research to try and overcome my own biases. Battery offers no solutions in the timeframe cited.

Steven Carr
Steven Carr
12 days ago

‘Another idea for energy storage is to use hydrogen, made by using excess power generated in periods of plenty to electrolyse water into its constituent elements, hydrogen and oxygen.’
It takes a lot of electricity to electrolyse water. Consumers will have to pay that.
Storing energy in hydrogen? An excellent idea.
We could spend a lot of money and build a lot of equipment electrolysing H2O to get H2, so the H2 can store energy.
Or we could use gas , CH4, where the H4 is already stored by nature for us as an energy source….
We can get stored hydrogen energy in gas way cheaper than stored hydrogen energy in water. CH4 > H2O because 4 is bigger than 2.

Nell Clover
Nell Clover
12 days ago

At 07:25 08/11/2024 UK electrical demand is 32GW and yet all of the UK’s 47GW of wind and solar capacity is generating a measly 3.7GW. And it’s been like this for 7 days straight.

£120bn invested in renewables and it is only aging gas and nuclear and a wood-burning coal plants keeping the UK’s electrical grid from collapsing. No energy storage system is going to provide back up for 7 days continuously.

That 32GW of demand is set to grow rapidly. Demand by electrified railways. Demand by electric cars. Demand by heat pumps. Demand by AI.

NESO’s report is a barely disguised refutation of Ed Miliband’s crazed plans. NESO’s report clearly states we will need to maintain and renew an entire shadow fossil fuel generation system to stop the grid collapsing. NESO’s report clearly states consumers will need to stop using big electrical appliances for weeks at a time when the wind doesn’t blow. It’s all there in black and white, written by the managers and engineers who run the system, and despite the obvious threat to their jobs.

Peter B
Peter B
12 days ago
Reply to  Nell Clover

Thanks for that killer fact. So wind and solar effective utilisation is 3.7GW/47GW – around only 8%.
Nuclear utilisation is 100% (always on).
You do wonder if they factor in the actual utilisation of these assets when comparing the relative costs of power generation.
I would also note that the UK’s regulatory and planning policies appear to be designed to make nuclear more expensive than it needs to be. As is the fact that it’s done on such a small scale – economies of scale are never realised by buying 10 power stations instead of only 1.

B Emery
B Emery
12 days ago
Reply to  Peter B

‘You do wonder if they factor in the actual utilisation of these assets when comparing the relative costs of power generation.’
I’m not sure they are thinking about this very well at all.
This is on the oilprice website this morning:

‘This week, low wind generation drove up power prices and underscored the need for reliable backup generation and significant energy storage capacity.’
It goes on and says:
‘Yet, this week, hourly power prices for the peak demand morning and evening hours soared to the highest level since the height of the energy crisis in the autumn of 2022. The reason was quite simple and unpredictable—very low wind speeds in northwest Europe which resulted in slumping wind power generation’

https://oilprice.com/Alternative-Energy/Renewable-Energy/Europes-Renewable-Reliance-Tested-by-Low-Wind-Speeds-and-Price-Surge.html

Steve Gwynne
Steve Gwynne
11 days ago
Reply to  Nell Clover

47GW of installed capacity is very different to the natural capacity factor which for wind in Northern Europe is around 30% of installed capacity.

https://www.linkedin.com/pulse/time-talk-capacity-factors-lars-schernikau

So 47GW could only ever be around 15GW in real time use. That is of course a 70% loss in energy production efficiency.

neil sheppard
neil sheppard
12 days ago

Miliband is almost certainly the most dangerous man in Britain. His policies run directly contrary to the interests of many working-class and middle-class voters of this country. The nation allows him to implement his crackpot ideas at its utmost peril.

Jeremy Bray
Jeremy Bray
12 days ago
Reply to  neil sheppard

That is the problem when you have an ideological driven PPE graduate in charge of a department that should be focused on realistic scientific issues. At least Claire Coutinho, his Conservative shadow, studied philosophy, which might have taught her to think straight and mathematics so she can do the maths on Miliband’s mad plans.

Andrew Fisher
Andrew Fisher
12 days ago
Reply to  Jeremy Bray

But she was nevertheless signed up to Net Zero too. It’s the law!!

Jeremy Bray
Jeremy Bray
12 days ago
Reply to  Andrew Fisher

Unfortunately true. There is a dearth of clear thinking in Parliament and the bureaucracy.

Andrew Fisher
Andrew Fisher
12 days ago
Reply to  neil sheppard

Unfortunately you can’t lay this all a Milliband’s door, though he is a true believer. Parliament as a whole passed this utterly idiotic Net Zero legislation, and Theresa May was a major culprit at the fag end of her premiership.. Even if that is your society’s general goal and trajectory, for God’s sake don’t legally mandate it, deciding how, why and when people and businesses can use the energy they need – and even keeps them alive!

John Riordan
John Riordan
12 days ago
Reply to  Andrew Fisher

The 2008 Climate Change Act was Miliband’s though, so he’s definitely a prime suspect.

Brian Hunt
Brian Hunt
12 days ago

The answers to the energy problem are under the ground in coal, oil and fracking; Above the ground, small modular, reactors have strong potential, but seem to be ignored by this government and the last lot.

I wish the engineering institutions would leave their ivory towers and produce a robust and objective rebuttal of Miliband’s crazy fantasy.

Maybe Elon Musk will ridicule Starmer’s government for this wacky idea.

andy young
andy young
12 days ago
Reply to  Brian Hunt

I like the idea of modular reactors, but, as Sabine Hossenfelder (a very smart cookie) has pointed out, they’re not proving too easy to build at the moment. My money’s on geothermal: get drilling chaps!

Ian Wigg
Ian Wigg
12 days ago
Reply to  andy young

SMRs are actually quite easy to build if the likes of Rolls Royce are given the go-ahead. They’ve been building them for years already (they’re what powers nuclear powered subs .)

Ian Wigg
Ian Wigg
11 days ago
Reply to  Ian Wigg

The bottleneck is the regulatory, planning, and most importantly rhe civil service controlled procurement process which insists that basically the whole planet should be given the opportunity to bid for the control of our energy security.

andy young
andy young
9 days ago
Reply to  Ian Wigg

Excellent point, & one Sabine maybe hadn’t considered.

Saul D
Saul D
12 days ago

Everything about green energy is about the numbers. Feeling warm and fluffy about wind and solar doesn’t change numeric realities. Personally, I can’t see a full zero-carbon energy economy without a large increase in nuclear power – the numbers are too big, and solar and wind are expensive at scale and still require back up – but I would also really welcome detailed numerical debates on what is really possible, by people who understand the difference between capacity and output, and total cost of delivery.

Prashant Kotak
Prashant Kotak
11 days ago
Reply to  Saul D

An excellent Idea – an open and honest series of debates, without heat but also without agendas, is needed by experts in the field – where all pros and cons are brought into the light. We should lobby UnHerd to set this up through their YouTube channels. Also, as you say, don’t shy away from the numbers – both in the science and the economics.

Jim Veenbaas
Jim Veenbaas
12 days ago

Net zero will never work. The question has always been how much long-term economic damage is caused before the scheme collapses on itself. I truly fear for Britain and the EU. They seem hell bent on being the canary in the coal mine – the stark example for the rest of the world of what happens when you have school children running your energy policy. This is very, very bad.

Lindsay S
Lindsay S
12 days ago
Reply to  Jim Veenbaas

“what happens when you have school children running your energy policy.”
Mental image of potato powered generators, on second thoughts, let’s not give Ed anymore silly ideas!

Santiago Excilio
Santiago Excilio
12 days ago
Reply to  Jim Veenbaas

There is always one (or more) canary. Take ‘Eugenics’ – 1900’s cod science based on Galton’s erroneous observations about heredity and dilution of “good stock” within the human gene pool. That idea took root and was lauded by all – politicians, doctors, scientists, foundations, philanthropists and before you could say ‘sterilisation’, eugenic laws were enacted in the in the US, UK, Germany and elsewhere. The Fabian society were very keen on the idea. The state of California was very taken with it and sterilised more “undesirables” than any other state. Germany then went even further and started gassing the mentally ill with CO and cremating them. The final solution was merely an extension of a programme that they had already designed for their own. Bless.

My point is this; a great deal of damage can be done by bad ideas that are adopted by the elites and ‘supported’ by the science. Sweden still had a sterilisation programme in place until the mid 1970’s. It can be very, very bad.

denz
denz
12 days ago

Everything about this Labour government is a disaster. That is all.

B Emery
B Emery
12 days ago

‘, saying he had just been given the “expert verdict on our clean power mission”, confirming that “clean power by 2030 is not only achievable but can lead to cheaper and more secure electricity” while generating “wealth” and thousands of new jobs.’

.’Spun out of the National Grid after Labour’s election win, it is a limited company with one “active person with significant control”: Ed Miliband, who has the power to hire and fire its senior staff’

Having taken advice from himself, about his own idea, Ed miliband has decided that not only is he an expert in electrics, large scale power distribution and the various forms of power generation, he is also an expert in the politics of job and wealth creation.
He has no record of success, but regardless of this, we have decided to give him a job fixing the national grid.

‘ £1.6 million per megawatt’

The companies selling this sh*t, having decided that miliband is not actually the expert he makes out, are taking UK citizens for a ride. Keep adding pound signs, miliband says it’s good value.

‘ 2023 Energy Act that allow Miliband’s officials to turn off “smart” appliances such as fridges, washing machines and heating’

Unless you really trust Ed milibands abilities, if you live in the UK make sure you buy an old appliance that can’t be hacked by the government.
They plan to turn off all the things you need to go about your daily business when their plan inevitably fails.
Failure of this policy will obviously be blamed on the public somehow, and you will pay in inconvenience.

Jeremy Bray
Jeremy Bray
12 days ago

Claire Coutinhio is Miliband’s Conservative shadow as well as being his predecessor in the job. Kemi Badenoch needs to ensure that these madly unrealistic plans get a regular battering in Parliament and assemble a panel of experts to tear them to shreds otherwise the Conservatives (or Remain’s) prospects must be of taking over a totally wrecked economy when Labour are driven from office.

Adrian Smith
Adrian Smith
12 days ago

How can we stop this lunatic before he destroys our country for good? With Trump going for drill baby drill the tiny effect we might have on reducing global CO2 levels will pale into insignificance.
There is no evidence that the slight rises in temperature over the last 150 years and the more significant rise in atmospheric CO2 have been anything other than a net benefit to the planet.

Adrian Smith
Adrian Smith
12 days ago

“using powers granted under the 2023 Energy Act that allow Miliband’s officials to turn off “smart” appliances such as fridges, washing machines and heating.”
This is truly frightening! Government over reach on steroids.

Jeremy Bray
Jeremy Bray
12 days ago
Reply to  Adrian Smith

Indeed, deaths from food poisoning and hypothermia will just be collateral damage to these fanatics.

Santiago Excilio
Santiago Excilio
12 days ago
Reply to  Adrian Smith

Yes, and they will make it illegal, if you have an “internet of things” device, not to have it connected to the internet so that they can remotely disable it.

Susan Grabston
Susan Grabston
12 days ago

We’ll be in penury long before the sunlit uplands of cheap renewables. He’s a Malthusian Canute resisting the physics and current tech lnological limitations of energy.

Mrs R
Mrs R
12 days ago

Net Zero is a scam that will ruin us all and do absolutely nothing to help the climate.

Jake Raven
Jake Raven
12 days ago

It astounds me that supposedly sensible people believe that Net Zero is possible and financially practicable.
I suggest strapping all wild, solar and hydrogen projects unless they are funded entirely by private investors with no subsidies. Instead, invest the money in rapidly developing and installing SMRs and continue with gas to work alongside them.
Start fracking and gas exploration to provide energy security and convert Drax to gas, burning timber imported from halfway across the world is not clean and makes no financial sense.
Finally, sack Red Ed before he does any more damage.

J. Edmunds
J. Edmunds
12 days ago
Reply to  Jake Raven

As a Green Party candidate in the recent election, I say bring it on.
I have solar panels, funded entirely by me, haven’t cost you a penny in subsidy.
I got them shortly after the war started, when Scottish Power wanted to charge me £400 a month, and so I decided I couldn’t afford *not* to have them.
At no time since have I paid SP more than £224.

Ingrid Sims
Ingrid Sims
11 days ago
Reply to  J. Edmunds

I trust you’ve been relying entirely on your solar panels to power your home this week! Oh wait – no sunshine. So, unless you’ve disconnected yourself from the grid, you’ve been using gas-fired power. And I imagine SP were paying you for your exported kWH’s during the summer with money from other customers’ bills. So don’t pretend you’re not being subsidised. I say this as someone who also has solar panels and is 65% self sufficient, but understands that this is not a solution to our national energy problems.

Robert
Robert
12 days ago

Why is the UK government driving its economy over a cliff? How does someone like Miliband end up with such authority?
When you end up in the streets protesting electricity rationing, you can take all those (not much) heat pumps and toss them at parliament, I guess.
This looks to be a disaster unfolding in a very predictable (and preventable!) manner.
STOP!

Santiago Excilio
Santiago Excilio
12 days ago

“Under close analysis, these bold claims are starting to fall apart.”

It doesn’t even need to be close – a cursory analysis provides all the answers, and has done for years. All it takes anyone is a calculator (if your mental arithmetic is weak) two years of UK energy comsumption data downloaded from Griwdwatch and about half an hour to work out that the UK can never power itself with renewables without a truly colossal (and I do mean seriously huge) amount of grid level electrical storage – the technology for which does not currently exist at anything close to the necessary scale.

With extant technology and at current prices it would be inconceivably expensive – and totally pointless. Build some more nuclear power stations and stop fannying about.

Ernesto Candelabra
Ernesto Candelabra
12 days ago

I once held my head in my hands at the prospect of Miliband being in charge of UK energy policy.
Yet there is such rich entertainment to be had from watching this rarest of nincompoops in unfettered action, that now I just want to encourage him. It is turning into a case study of how floridly insane a politicial ideology can get.
I fear it won’t last, however. The Labour machine is giving him enough rope. Soon a nice position will appear around the 300k price point at the EU/NGO/UN. “Ed, you laid the foundations of Britain’s great future as a renewable energy titan. Your work here is done; now take your noble message to the world!”
So I think we should enjoy him while we can.

Prashant Kotak
Prashant Kotak
12 days ago

Or they will shunt him into the Lords. Lord(s) help us.

John Riordan
John Riordan
12 days ago

“Having promised during the election to save households £300 a year by creating a Net Zero electricity network by 2030, he did it again on Tuesday, saying he had just been given the “expert verdict on our clean power mission”, confirming that “clean power by 2030 is not only achievable but can lead to cheaper and more secure electricity” while generating “wealth” and thousands of new jobs.Under close analysis, these bold claims are starting to fall apart. “

Such claims fall apart even without close analysis. Miliband is proposing that an industry is about to become thousands of jobs more labour intensive and yet somehow at the same time its products will be cheaper. This is a ludicrous claim that even most basic acquaintance with economics reveals as such: labour is usually the single largest cost component of almost all productive enterprises, and this is only untrue in nations that are so poor that human labour is almost worthless.

What is NOT possible is to to make something more labour-intensive in a wealthy nation without also making it more expensive. But that’s Green economics for you. Complete bollocks.

Prashant Kotak
Prashant Kotak
12 days ago

I don’t think we should let the Tories, including Claire Coutinho, off the hook here. Their plans were less aggressive than the insanity Miliband is perpetrating, but they were still far from realistic. What needs to happen with regards to net zero is that the politicians need to be realistic that this can only be done slowly, over something like three to five decades, unless we want to plunge the entire population into penury. What Miliband is upto, is just an outright vanity project.

UnHerd Reader
UnHerd Reader
12 days ago

I recall an article in this very journal questioning if Mr Milliband, and/or his brother may be involved in nebulous activities to financially benefit from this madness.
https://unherd.com/2024/09/the-miliband-files/
I don’t have the benefit of a fine education as some here do, but a wise man once said to me ‘always follow the money’
Forgive me if I am wrong…