Government rejects claims renewables will add £200 to

The government has today distanced itself from reports that it expects average domestic energy bills to rise by more than £200 a year as a result of its new renewable energy strategy, which is due to be released on Wednesday.

According to various reports over the weekend, the long-anticipated new renewable energy strategy will have a significant impact on energy costs, driving up average annual household bills by between £200 and £230, and have a similarly inflationary effect on businesses' energy costs.

However, a spokeswoman for the Department of Energy and Climate Change (DECC) said the government did not recognise the estimates as accurate. "We will release the full report to Parliament on Wednesday," she said. "But I can say now that we do not recognise those figures - our figures are significantly lower."

Despite calls this morning for a scaling back of wind energy targets in favour of a renewed focus on nuclear power, the new strategy is expected to reiterate the government's commitment to a huge increase in wind energy capacity.

It is also expected to propose increased investment in biomass, waste-to-energy and marine energy schemes, and set out plans for incentivising investment in small-scale renewable energy systems through a feed in tariff and new green loans scheme.

However, the spokeswoman for DECC again dismissed reports in the Sunday Times yesterday that the government was planning new "green mortgages" that would offer homeowners low interest loans to invest in low carbon technologies, insisting that the government would outline plans for a less far-reaching green home loan initiative.

The paper also reported that households which refuse to take out green mortgages could face higher council tax rates and raised stamp duty - a charge dismissed outright by DECC.

"The minister [Ed Miliband] does not support the idea of penalties [for people who do not take out green loans]," said the DECC spokeswoman. "We have been very clear in our position that we support plans for a 'pay-as-you-save' scheme, where households pay back green loans from the resulting energy bill savings and the loans are attached to the property rather than the individual."

The renewables strategy will form the centrepiece of a number of new low carbon reports from the government to be released this week. It is expected to be accompanied by the official launch of the long-anticipated study into the viability of increased rail electrification, as well as an announcement giving the go-ahead to three controversial ecotown projects in Norfolk and Cornwall.

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