What Is Wrong With This Government?

Do ministers not understand how financially exhausted this country has become?

Households are struggling, pensioners are frightened to turn on the heating, businesses are closing and British industry is being priced out of its own country.

Yet instead of confronting the policy failures that helped create this crisis, the Government is preparing to repeat them on an even greater scale.

Our reconstruction of DESNZ’s 2035 generation-cost model found that combined-cycle gas generation was costed at approximately £113/MWh, including around £45/MWh of carbon charges.

Remove that policy-imposed carbon component and the underlying generator-side cost falls to approximately £68/MWh, including fuel, capital and operating costs.

The Government is now supporting floating offshore wind at a guaranteed AR7 price of £216.49/MWh. That is approximately 3.2 times the underlying £68/MWh gas cost. Worse still, the Government’s administrative ceiling for floating wind was £271/MWh-almost exactly four times the cost of gas without the modelled carbon charge.

These figures are confirmed in the official DESNZ Allocation Round 7 results⁠.

And £216–£271/MWh is not the complete system cost.

Consumers must also fund thousands of miles of subsea cables, new coastal substations, transmission reinforcement, port reconstruction, balancing services, constraint payments and dispatchable capacity for periods when the wind does not produce what the system requires.

This exposes the central distortion at the heart of British energy policy.

Carbon pricing is deliberately designed to increase the cost of fossil-fuel generation and change investment decisions.

Government then compares that artificially burdened gas generation with subsidised renewable electricity, without clearly separating the underlying engineering cost from the taxes, subsidies and wider system costs created by policy.

Gas is taxed to make it appear uneconomic.

Floating wind is guaranteed an inflation-linked price to make it investable.

The consumer pays at both ends.

The Government calls this competition, but it is nothing of the sort.

A reliable gas generator must pay for its fuel, construction, maintenance and carbon emissions while selling into a volatile market.

A floating-wind developer is offered long-term revenue protection at several times the underlying cost of gas, while much of the network and balancing burden is recovered elsewhere across the electricity system.

Even the industry is signalling trouble.

One report describes Britain “doubling down” on more expensive floating wind, while another reports that flagship North Sea floating-wind projects have stalled.

Rather than pausing to examine whether the technology is affordable, deliverable or genuinely necessary at the proposed scale, governments respond by offering more subsidy, more public money and greater protection from commercial risk.

That is what is wrong with this Government:

it measures success by gigawatts consented, subsidies awarded and carbon targets pursued-not by affordable bills, reliable power or industries saved.

It has confused installed capacity with energy security and political ambition with engineering reality.

Britain does not need another technology-specific spending spree imposed from above.

It needs an independent, transparent comparison of complete system costs:

generation, transmission, balancing, backup, curtailment, decommissioning and financing. Every technology should be assessed on the same basis, without hiding carbon taxes on one side or network subsidies on the other.

Floating wind is not defeating gas in a fair contest.

Government policy is preventing gas from competing fairly while guaranteeing floating wind up to almost four times the underlying generation cost.

The country is not being broken by an unavoidable shortage of energy.

It is being broken by political decisions that make reliable energy expensive and extraordinarily costly alternatives appear necessary.

Shane Oxer. Campaigner for fairer and affordable energy