The Government announced today that the cost consumers will pay to support renewables and nuclear power development will triple. The charge on consumer energy bills will increase from £20 to £95 per year by 2020, an increase of £75 for the average consumer. As a result the amount consumers pay on their energy bill to support the creation of new low carbon power supplies will go up from 2% of their total energy bill to 7%.
The Government claims that this increase in consumer energy bills will be offset by their energy efficiency policies and by making the UK less dependent on gas. However, the commitment to wean the UK off gas, which has been the main cause of rising energy bills in recent years, was dealt a blow. Following a major disagreement between the Liberal Democrat coalition partners and George Osborne, the Conservative Chancellor, the decision on whether to create a legally binding target to de-carbonise UK electricity was delayed to 2016, after the next election.
Meanwhile, the Government maintained absolute silence on whether they would be prepared to recycle carbon tax revenue to reduce energy bills by making homes highly energy efficient.
Ed Matthew, Director of the Energy Bill Revolution campaign said:
“The Treasury has generously agreed to stick the entire cost of de-carbonising UK power on to consumer bills. At the same time they are pocketing all the money they are raising in carbon taxes. If they recycled carbon tax back to households they could create the world’s most ambitious and effective energy efficiency programme – making over half a million homes a year super energy efficient. It is enough revenue to end fuel poverty and In time help every UK home slash their energy bill.”
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