Gas prices could push renewable savings to £100bn

Longer-term commitment to renewable energy will pay off for ministers unless the world rejects emissions reduction efforts completely, government advisers have found.

The committee on climate change (CCC) said investors needed more political commitment to low-carbon technologies throughout the 2020s to begin pressing ahead with major new projects.

Its latest report suggested doing so would save consumers up to £45 billion. With rising oil and gas prices this could increase to as much as £100 billion.

Even the development of shale gas would not change the equation significantly, the CCC found. It suggested further investment in renewable energy would only cost taxpayers an extra £20 a year between 2020 and 2030.

"In order to secure maximum economic benefit for the UK, it is crucial that the government gives certainty to investors by legislating to chart a clear course well beyond 2020," CCC chairman Lord Deben said.

"Only then will we be able to insure against the risk of much higher future energy prices; enhance Britain’s energy sovereignty; and protect ourselves against dangerous climate change."

The CCC suggested the energy bill could set a target to cut the carbon intensity of power generation to a tenth of current levels, extend funding for the development of less mature technologies and seek to mobilise new sources of finance like the Green Investment Bank.

Investment in clean energy has fallen by half under the current government, prompting frustration from Labour.

"This report clearly shows that if the government is serious about tackling spiralling energy bills, improving our country's energy security and stopping dangerous climate change it must decarbonise the power sector by 2030," shadow energy and climate change secretary Caroline Flint said.

"The government's failure to include a clear commitment to decarbonise the power sector by 2030 just creates more uncertainty for investors who want to invest in British businesses and jobs, and help get our economy growing again."