Draft Renewables Obligation (Amendment) Order 2026

Claire Coutinho Excerpts

Wednesday 11th March 2026 General Committees

[Claire Coutinho (East Surrey) (Con)]

For those who do not understand how renewables obligations work, let me bring Members up to speed. Three quarters of our wind and solar power is generated through renewables obligation subsidies. That means that every time electricity is generated, suppliers get the wholesale price plus a massive subsidy on top. Every time the wind blows, some wind farms get up to three times the market price of electricity. If wholesale electricity prices are £80 per MWh—which they roughly were before the crisis—wind farms are getting two renewables obligation certificates on top, at around £70 each. That means they have been getting £220 per MWh, which is almost three times the market price for electricity.

For years the public have been told that the energy we get from the wind and the sun is free, but nothing could be further from the truth when we look at the deals. Labour likes to say that gas is the problem, and in the last week the price of gas power has been high, at around £120 per MWH, but here is what they are not telling us: the renewables on the scheme will always get more than the gas price. Right now, there are wind farms getting £270 per MWh, because they get whatever the wholesale price is plus the subsidies on top.

The renewables obligations deals last for 20 years, so let me be crystal clear: the wind and solar farms on the scheme are not cheap. They can never be cheap. No matter what the gas price is or the wholesale cost of electricity is, they will always be much, much more expensive—and the subsidy goes up year after year. The Government are trying to address that today, but it is the subsidy itself, not the incremental inflation change, that does the real damage.

I am afraid it is the Secretary of State who started all this. Back in 2008, he was the one who effectively doubled the subsidy that got us into this position. It was a bad deal. He was paying through the nose because, ideologically, he thinks renewables are better, even when they are more expensive. At the same time, the public have been told that renewables are cheap, which is a fundamentally dishonest position. That is why our position is simple. If we argue that renewables are cheap, and truly want them to be so, we have to take these eye-watering deals out of the system. Rather than just tinkering around the edges, which is what the Labour party plans to do today, we should end the rip-off subsidies for good.

Will the Minister explain why, in the event of an energy crisis, he thinks our constituents should pay wind farms three times the market price for electricity? It has not cost them any more to produce their power, yet they are currently getting a huge increase in profits at the expense of our constituents’ bills. Should we not be doing everything we can to improve the cost of living? When prices are high, as they are now, how can we justify baking in paying some wind and solar farms double or triple the price? How on earth can people who are worried about their constituents paying £120 per MWh for their gas power justify paying three quarters of our wind and solar farms up to £270 for their power? Our cheap power plan would scrap the subsidies and put more money in people’s pockets.

Labour have tried to move the costs on to people’s tax bills. Ordinary working people who are facing higher taxes on their income, pensions, small businesses and student loans will be paying for the subsidies. It is in the Minister’s gift to change the subsidy arrangements, as this statutory instrument shows. There is no legal barrier to scrapping them, or we would not be able to make the changes we are making today. If the Government keep the rip-off subsidies in place, they will be making it clear to all their constituents that they are prioritising the profits of wind developers over the energy bills of ordinary people.

If the Government want people to use electricity to heat their home or drive their car, they need to make electricity cheap. Instead, as even Martin Lewis has pointed out, the Secretary of State has spent the last two years piling cost after cost on to electricity bills. When it comes to security of supply, the Government are choosing to shut down the North sea, only to import dirtier gas from halfway around the world. We have fewer jobs, higher bills and more carbon in the atmosphere. It is simply mad. The Government have got this backward. They need to maximise UK production from the North sea and make electricity cheap.

The British public are not stupid. They can see that the Government’s energy policy is not serious. Although we will support the order, we urge the Government to go much further, end the subsidies for good and put cutting people’s bills first.