Energy News

New Green Bill will add £500 to energy bills

Wednesday 18 May, 2011

By Martin Fagan - martin@consumerchoices.co.uk

Hard pressed Brits hit with higher energy bills to pay for cuts in carbon emissions and higher “green” taxes.

The government’s announcement it will commit the UK to a legally binding 50% cut in greenhouse gas emissions by 2025 will leave Britain £13.4billion worse off and add £500 to each household’s energy bill.

Economists and consumer groups say the raft of measures and targets announced by Energy Secretary Chris Huhne are the toughest of any country in the world and will come at a huge price for Britain’s struggling economy and its financially-strapped citizens.

The move to make the UK's energy supply greener may be welcomed by environmental groups, but British households will be footing the bill.

According to forecasts by the independent Committee on Climate Change, if the government wants to hit these new targets, household energy bills will rise by £1 a week for the next nine years.

If this happens, by 2020, the average energy bill will have rocketed by nearly £500, an increase that doesn't factor in any price rises in that period.

“The average household energy bill is already £1,132 a year, and that includes £84 of hidden taxes,” said Ann Robinson, director of consumer policy at independent switching service, uSwitch.com.

“The commitment to cut carbon emissions in half could see annual energy bills hit £1,600 within nine years. With two suppliers having already hinted at price rises this year, the announcement could be the death knell for cheap energy in this country.”

In contrast to the UK’s proposed 50% cut, the U.S. has pledged to cut greenhouse gas emissions by only 3% over the same period, while China - the world’s biggest polluter - expects its carbon dioxide emissions to rise.

Adam Scorer, director of external affairs at energy watchdog Consumer Focus, said: “Given the lack of trust in the energy industry, it’s even more important we see greater transparency and forensic analysis on energy pricing and tighter scrutiny by the regulator of the energy firms’ accounts.”