Jul 2008 30

In recent months there has been a lot of discussion about how the Government might help people facing high energy prices.  The unions, politicians and various campaigners have called for a crackdown on energy companies they accuse of profiteering.

Yesterday, the Renewable Energy foundation revealed that the Government’s own environmental policies are a major component of the price of energy:

  • Climate change policies make up around 14% of the average domestic electricity bill and 3% of the average domestic gas bill.
  • Climate change policies also make up 21% of the average business electricity bill and 4% of the average business gas bill (i).
  • By 2020 the burden of green policies will have risen to 18% of the average domestic electricity bill and 55% of the average business electricity bill(ii).
  • Despite this massive cost the regulations are projected to achieve very little.  The Renewables Obligation is expected to cut emissions by just 1.6% at an incredible cost of £400 per tonne of carbon emissions saved.

    Most of these climate change policies, from the Renewables Obligation to the European Union Emissions Trading Scheme, have been introduced since the current Government came to power.  They have been major drivers of the rises in energy prices.  While politicians single out energy companies for criticism they keep quiet about their own complicity in rising prices.

    With Ofgem confident that our energy market is reasonably competitive isn’t hounding electricity companies just a crude attempt to displace popular resentment of high prices?  If the Government were really committed to bringing down prices it could easily do so by scrapping some of these ineffective climate change regulations.

    • Hardeep_Singh

      ‘Climate Change’ an onerous and expensive burden on all working people throughout the country simply to feed the delluded egos of the eco-priesthood. How can it be worthwhile to pursue such ill thought out policies matched only by the usual absence of management in terms of their delivery and performance.
      Using less should actually cost less I can’t see why it doesn’t follow that simple logic. I wouldn’t pay more by parking my car for a shorter period of time so why does less energy use mean more?
      I feel that the answer appears lie within the geopolitical arena. With rapidly increasing competition throughout the world we can ill afford to have our cake and eat it too. We need to make better use of every ounce of energy we have in order to remain competitive. However the reduction in usage would have meant that utility revenues would have dwindled so instead the price per unit is increased in order to get the same revenue for supplying less. Smiles all around the boardrooms as they can trade the surplus oil, gas, etc that isn’t being consumed, no benefit to the average tax paying consumer though.
      The green argument is a very shallow one and the so called ‘obligation’ should be renamed to ‘liability’ as they serve no other purpose than to burden us with yet another financial pressure that we could all do without.
      The Greenham Common brigade that were made redundant after the closure of the airbase now have a new cause to yet again enforce their perspective will on us. This is all fine until it starts to affect people’s jobs, security and income. Another excuse to implement liberal mindedness into national energy policies.