Revealed: Renewable Energy Jobs Are Being Subsidised by £250,000 Each, Every Year

Recently, Shadow Energy Secretary Ed Miliband has been promoting his party’s ‘Green Prosperity Plan’ again, promising more jobs, more investment and lower bills. However, these claims do not stand up to scrutiny. Currently each job in the wind and solar power sectors is being subsidised by the taxpayer to the tune of over £250,000 per job, every year. This is the path to penury, not prosperity.

Miliband was ‘ratioed’ on X, meaning he received more replies than likes, so maybe the public is starting to rumble his ruse. Nevertheless, he is likely to be in the Cabinet after the election, so we need to pay attention to what he says. Time to work through the data to find out how much these mythical jobs in the renewable sector cost us.

From time to time, the ONS publishes an assessment of Low Carbon and Renewable Energy Economy (LCREE). This covers the number of businesses, turnover and how many jobs are involved in the LCREE sector. Helpfully, it breaks down the figures by sector, including offshore wind, onshore wind and solar power. The latest available figures for 2021 show the number of full-time equivalent jobs in the U.K. for these sectors was 10,600, 5,000 and 6,400, respectively.

There are three subsidy regimes for renewable energy in the U.K. These are Feed-in-Tariffs (FiTs), Renewables Obligation Certificates (ROCs) and Contracts for Difference (CfDs).

Each year Ofgem publish the FiT report and dataset that details the total amount of electricity generated, total payments and the capacity installed by technology. In scheme year 12, running from April 2021 to March 2022, 79.4% of FiT capacity was solar and 11.9% wind. The rest was made up of hydro and anaerobic digestion plants. The total payments under the FiT scheme were £1,557m. If we split these payments by capacity, we can determine that solar power received £1,236m in FiT payments and wind (assumed to be onshore) received £185m.

Details of ROCs issued cab be found on the Ofgem portal. The value of ROCs related to the output period of the whole of 2021 was £2,009m for offshore wind, £1,251m for onshore wind and £493m for solar power.

The Low Carbon Contracts Company publishes a database of CfD payments that can also be split by technology. This shows that offshore wind received £612m in 2021. This figure is lower than might be expected because gas prices started to spike in late-2021 and so some CfD-funded wind farms started to refund money under the CfD scheme. Because strike prices for onshore wind and solar power tend to be lower than for offshore wind, these two technologies paid back £22m and £204m, respectively.

The total subsidies in 2021 for these three sectors is around £5.56bn. This compares to the ONS estimate of £14.56bn turnover for the same sectors. Putting it another way, 38% of the turnover is pure subsidy.

Pulling all this together, we can add up the total subsidy received for these technologies and compare it to the number of jobs in each sector.

Read More: Revealed: Renewable Energy Jobs Are Being Subsidised by £250,000 Each, Every Year

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