Last week the government announced details of some of its plans to reform the power sector ahead of the first reading of the Energy Bill this week.
There has been a widespread welcome for further funding. But environmental activists say that MPs must now struggle hard for a proper decarbonisation target and support for smaller generators to break the 'Big 6' deadlock.
A decision about setting carbon emission targets for 2030 has been delayed until 2016, which will be after the next UK general election.
"By failing to agree to any carbon target for the power sector until after the next election, David Cameron has allowed a militant tendency within his own ranks to derail the Energy Bill," declared John Sauven, executive director of Greenpeace.
Lord Deben, chair of the Committee on Climate Change, responded: "The agreement on the levy control framework is very positive. This should be sufficient to support investments in renewables required to meet the 2020 EU target and carbon budgets, together with demonstration of CCS and investment in nuclear new build."
He continued: "We are disappointed that a carbon intensity target will not be set until the next Parliament. This leaves a high degree of uncertainty for investors and does not address widespread investor concerns raised in recent months; it could adversely impact on supply chain investment and development of projects to come on line after 2020."
"It is essential now that delivery of the Electricity Market Reform proceeds on the basis that this is aimed at achieving early decarbonisation of the power sector, which is the economically sensible path in a carbon and resource constrained world," he concluded.
Responding to the government's announcement, Caroline Lucas, MP for Brighton Pavilion and until recently leader of the Green Party in England and Wales, said: “While I welcome the government’s deal on £7.6 bilion of new funding for renewables and the green jobs this will bring, this announcement should have done far more to offer long term certainty for the sector beyond 2020 by committing to a zero carbon electricity supply by 2030."
She continued: “In 2006, David Cameron said that ‘we need targets as well as technology’ to make the shift to a greener economy, yet he has allowed his Chancellor to completely disregard the Committee on Climate Change, his coalition partners, the renewables industry, NGOs and a raft of the UK's largest businesses by scrapping the 2030 decarbonisation target.
“The real threat to our energy bills is not green policies, but the UK’s ongoing dependence on expensive and polluting imported gas, which today’s announcement will only perpetuate – along with plans to subsidise new nuclear power through Electricity Market Reform.
“Coalition ministers have stated again and again that their pledge to spend no public money on new nuclear will hold, yet it’s obvious that EMR has been designed to allow subsidy via the backdoor.
“Ministers must now come clean about their plans to subsidise the nuclear industry after 2020 through the ‘Contracts for Difference’ mechanism in the Energy Bill.
“At an estimated cost of between £5 billion and £7 billion per power station according to EDF, nuclear is eye-wateringly expensive and there’s a real risk that funding will be sucked away from renewables.
“The government must urgently ditch this obsession with nuclear power, which threatens to add a huge burden to household bills for decades to come.”
Ms Lucas continued: “Ed Davey is right to say that energy efficiency measures should significantly bring down bills in the years to come – DECC’s own figures show the UK could reduce electricity demand by 40 per cent by 2030, a massive saving for bill payers.
“But since the government’s weak Green Deal policy looks unlikely to go anywhere near to delivering this, the Energy Secretary’s rhetoric on demand reduction now needs more concrete policies to match.
“And if the Chancellor really cares about people’s energy bills, he will listen to calls from MPs to use the revenue from carbon taxes and the EU Emissions Trading Scheme to invest in a nationwide housing retrofit to ensure all of our homes need far less energy to keep warm.”
The Green MP concluded: “This government’s apparent determination to keep the UK hooked on gas even in the face of the UN’s latest warnings on climate change also raises serious questions about who Ministers are listening to over energy policy and the influence of pro-gas voices like Lord Howell.
“When the Energy Bill comes to Parliament, MPs must work together to get the 2030 decarbonisation target into legislation, and to ensure measures to open up the energy market for independent and smaller generators, and community projects – breaking the monopoly of the Big 6.”