It might be good news for consumers, but not necessarily for renewable energy.

This week, Scottish Power became the final member of the Big Six energy giants to announce cuts in their gas prices.

The cuts, averaging 5%, follow steep price rises of 15-19% last summer, and so really should be lower; in fact to be fair, according to Greenpeace calculations, as low as 8.4% for gas and 10.7% for electricity.

The cuts reflect the falling wholesale commodity price of gas; and it is continuing to plummet, on both sides of the Atlantic.

The price at which gas that will be consumed this summer is bought today, has dropped from a high of 65p/therm in the middle of last November to 52p/therm yesterday, a drop of 20%, while next winter's prices have fallen by 13% from 75p to 65p.

Month ahead prices have fallen even more, from 67p to 52p, a huge drop of 22%.

Yet the chief executive of npower said this week that it wasn’t possible for consumer energy prices to drop in Britain because commodity prices keep increasing.

The chief executive of the National Grid, Steve Holliday agreed, saying: “In any scenario, it is hard to imagine that the costs of our energy are going to be lower than they are today. It is not the real world. People should be honest with consumers. Energy costs are going up”.

Yes, the price of crude oil remains stubbornly high, but that of coal is also falling.

Meanwhile, carbon price forecasts have also been cut, compared to this time last year, although prices in the EU Emissions Trading System (ETS), precisely because they are at a historic low, are expected to rise, albeit not significantly.

This is all bad news for renewable energy and nuclear power because it means that suppliers will favour the cheapest source of electricity and this factors in to investment decisions over new plant.

The problem is becoming acute in the US.

One supplier, MidAmerican Energy Holdings Company, said: “Renewables without tax incentives are simply not cost-competitive with the fourth option, which is natural gas.”

MidAmerican's spokesperson, Jonathan Weisgall, said they would like to “be doing energy efficiency, renewables, and natural gas” for the next decade, but without incentives, which face a huge cut in the States that have seen orders for solar power for after next November vanish completely, renewables may not be viable.

One reason for the low gas price is a large glut in gas supplies caused by the dash for shale gas.

As North Sea supplies run down, the UK is importing more gas. The sheer volume of shale gas on the market, while not necessarily being a direct part of what we burn in our power stations and cookers, is a factor in the low price.

The cheaper the gas, the less incentive there is to buy renewable energy or invest in new renewable energy generation plant rather than a cheaper combined cycle gas turbine plant, which we know how to build almost with our eyes shut.

This is not good for climate change.

Although home produced gas-generated electricity is twice as climate friendly as coal-fired, the same cannot be said for electricity generated from shale gas, which is a huge contributor of greenhouse gases when both methane and carbon dioxide are considered, according to a major new study by three Cornell University researchers.

Methane, which is 23 times more powerful as a greenhouse gas than carbon dioxide, although shorter lived in the atmosphere, on an overall basis makes up 44% of all greenhouse gas emissions from shale gas production, when considered on the 20-year time frame.

The shorter time frame is critical, given possible tipping points in the global climate system over the coming few decades, say the authors of the study titled Venting and Leaking of Methane from Shale Gas Development, Professor Robert Howarth and Renee Santoro, at Cornell University.

In the UK, subsidies for renewables are not as vulnerable to political vagaries as they are in the US, but they are under review and subject to the economic constraints of the difficult investment climate and the low price of carbon.

If certain tendencies in the Conservative wing of the coalition government had their way, all European climate change legislation would be swept aside, and with it the requirements for energy utilities to source increasing percentages of their energy from renewable sources.

This is why a steady policy eye must be kept on the overall global warming potential of gas in the UK mix and on the need to continue to support renewable energy and energy efficiency.

Civitas (whose recent anti-wind propaganda stirred the columns of the Mail and Telegraph) can moan about wind power, using outdated information and the fact that in the short term gas prices might be lower.

But in fact we must particularly guard against constructing more gas-fired power stations as this would lock us into higher emissions for twenty more more years.

We must continue to support nascent low carbon industries because we know their costs will reduce in time.

And we must make more effort to factor in the true climate-warming costs of gas into policy, and economic, decisions.