1. What's the point?
To control bills, cut carbon emissions and ensure the lights stay on. Lots of our old coal plants are going to close between 2015-17 followed, a decade or so later, by our nuclear plants.
If the government did nothing at all we'd probably just get lots of gas with predictable consequences for our Co2 emissions and highly unpredictable consequences for bills and energy security.
2. What's in?
Ok, so the structures are complex - but they've mostly already been announced. The key new information here is that by 2020/21 £7.6bn a year (in today's coin) will be taken from bills to fund what the government defines as clean energy (that's nuclear, wind, biomass or even clean energy in other people's countries).
Sounds like a lot? Yes. It's about what we currently spend on imported gas for heating and electricity in fact - more on that later.
3. What's out?
There is no new carbon or clean energy target - though that may change in 2016.
This could have a big impact on renewable investment. The renewables built to meet the existing EU 2020 target (such as onshore wind and biomass) will happen.
But ministers had hoped development of new offshore wind technologies in the UK would prompt the emergence of an industrial base supplying our own demand and exporting around the world - the clean economy, in short.
This industry though, will barely have got going by 2020 after which nobody knows. Investors call this a 'cliff edge' and who wants to drive fast towards a cliff?
UPDATE:
It looks like most - but not all - renewable investors are supporting the measures. There is a large amount of relief that the government even agreed to provide the funding neccessary for the 2020 target. It may even engender confidence about the longer term.
4. And bills?
Per unit of power, the government predicts, bills will rise.
The Telegraph says the measures add £170. The Times says £100. We'll get back to you on the numbers.
The amount that can be levied from everyone's bill for clean energy will go up, from just under £3bn now to £7.6bn in 2020/21.
The consequence of this is that we will get more clean energy and so use less gas and coal (which, of course, also comes off bills - but isn't controlled).That means is that it's hard to say whether bills will rise more because of clean energy than they would have anyway.
For example, between March 2011 and March 2012 the higher wholesale gas price added £100 to the average bill.
The government's climate advisors, The Committee on Climate change have calculated that clean energy will actually add less to bills than a new dash for gas - because of the impact of the rising gas price and the price of carbon dioxide (itself, however, an environmental cost).
Some believe that fracking and shale will drive gas prices down by so far that gas is always the cheapest option. The IEA looked at this and didn't think EU prices would fall by that much - but it's possible.
The only sure way to reduce bills though is through energy efficiency - which the government has put out to consultation.
5. You've not mentioned Nuclear?
It's a mixed bag for nuclear investors - who would probably also have liked a target for carbon free power by 2030.
Nuclear is relatively slow to build - and only one project is ready to go so relatively little of the money allocated in this announcement (up until 2020) will actually end up going to nuclear projects.
But nuclear has arguably got better prospects. It now has a structure (contracts for difference) which allows the government to directly support the nuclear industry (with some concerns over whether this is illegal EU state aid or not).
With the support mechanism in place the government can sign agreements with nuclear investors agreeing on the price they will get once the project is finished. Less of an option for wind projects which are built in far smaller increments.
So whilst renewables may get the cake until 2020 - any money available beyond then may well be allocated in advance to big new nuclear power stations.
6. And the dash for gas?
This is a bill for everyone. Gas, long the neglected child of the subsidy world, now has it's own special support scheme called the 'capacity mechanism'.
The idea is to pay gas plants just to exist - irrespective of whether they generate any power so as to ensure they will be built despite the prospect of large amounts of clean energy on the system.
Clean energy, like wind and nuclear, costs a lot to build but is then very cheap. Gas is the reverse, it's cheap to build, but expensive to run - so when the wind blows, or the nuclear power plant is built, it can find it doesn't run much of the time.
That said, the measure is bound to cause fierce debate. Not everyone, even in the gas industry, thinks its necessary and it means consumers will for the first time be paying a subsidy to a technology that isn't clean. Others will say it's yet another cost of renewable energy.
UPDATE:
7. And what about Tariffs?
There's been an element of confusion about this after the Prime Minister, David Cameron, used an appearance at question time to promise the government would legislate to force energy companies to offer consumers their lowest tariff.
On closer examination this policy appeared to suggest companies could only have one tariff, which was confusing. However Ofgem then intervened with their own proposals - known to the government - which would use their own statutory powers to force companies to reduce the number of tariffs they offer to four and would force companies to automatically put many (but not all) customers on the cheapest available for their payment method.
The bill is now expected to take these proposals and put them in legislation - with some relatively minor modifications.
8. Anything new on the horizon?
Yes. The government has announced not one, but two major consolations on things that are missing from the bill.
The first, unlikely to be welcomed by the green lobby, is to exempt energy intensive users from some of the costs of decarbonisation. This will doubtless go down well with representatives of steel manufacturers such as Tata. It may also mean more of the cost of the bill is put onto consumers. Ultimately, someone has to pay.
The second, likely to be welcomed by the green lobby and more or less ignored by most everyone else, is a consolation on how to reduce demand.
Ideas on the table include paying people for each unit of energy they save or using the capacity mechanism (see above) to reward people who offer to reduce their demand - on demand. The idea being that instead of building a new gas plant to pick up if the wind doesn't blow, you strike deals energy users to cut their use if the wind doesn't blow.
This stuff gets quite astonishingly geeky. For example, you may, in future, be able to buy a fridge which hooks up to your smart meter and turns itself down when the energy company asks it to. One snag? None of this in the bill.
