The painful truth: Energy bills will keep rising, whatever politicians say

It is time to end the fiction that energy bills can be brought down by fiat

Share
Related Topics

It is rapidly becoming a truism that Britain’s energy prices are unnecessarily high and that it is within the gift of politicians to bring them down. Neither suggestion is correct, however, rendering much of the debate about household bills unhelpfully detached from reality.

The most recent offender was Ed Miliband, with his party conference promise to freeze bills for 20 months if he wins the next election. For all its superficial appeal, the scheme is woefully wrongheaded. It will likely have little effect, merely boosting prices before and after the freeze. Worse, the prospect of government caprice threatens much-needed investment in the sector. Talk of the lights going out may be a touch histrionic. But a fifth of our generating capacity is to close over the coming decade and some £110bn is needed to plug the gap. Mr Miliband’s posturing just upped investors’ prices – and that means higher bills, not lower ones.

The Labour leader’s populist spasm also wilfully ignores the green agenda that his own government was so instrumental in setting. Not only can energy companies not justifiably be charged with profiteering; their margins are too low and their investment commitments too high. But the fastest-rising part of bills in recent years has been the environmental levies to pay for (costlier) carbon-free power generation and energy efficiency schemes.

As concerning as Mr Miliband’s lapse of understanding of the energy market is the gift that he has given to sceptical Tories long keen to water down carbon-reduction plans. Given the menace of climate change, green charges on bills are no luxury. But the Chancellor wants to crimp them so he can trump Labour’s bills pledge in his Autumn Statement. It can only be hoped that the Energy Secretary stays his hand. A recent warning that bills will soar by another 20 per cent by 2020, partly thanks to green costs, will not help, though.

True, the Energy Companies Obligation and other efficiency programmes are far from perfect. But to suggest they can simply be abandoned is no less of a sleight of hand than is Mr Miliband’s price controls, and the result would be equally catastrophic.

It is time to end the fiction that energy bills can be brought down by fiat. They cannot. A growing population, living ever more energy-intensive lives, supplied by an ageing infrastructure that must be replaced by new green technologies, means higher bills. The only way to limit the impact is to reduce the amount of power we use. Yet the government scheme to help the poorest save energy is of questionable cost-effectiveness; and, as we report today, the Green Deal to finance insulation and the like through future bills is over-complex and under-subscribed.

It is here that attention must be focused, not on the hot air of politicians hustling for short-term advantage. Draught-proofing and double-glazing may not be sexy, but they are the only way to make a difference without sacrificing the future.

React Now

Latest stories from i100
iJobs Job Widget
iJobs General

Tradewind Recruitment: Intervention Teacher Required To Start ASAP.

£125 - £150 per day + Negotiable: Tradewind Recruitment: A 'wonderful primary ...

Tradewind Recruitment: Maths Teacher

£90 - £140 per day: Tradewind Recruitment: Our client is an 11-16 mixed commun...

Recruitment Genius: PHP / Drupal / SaaS Developer

£32000 - £36000 per annum: Recruitment Genius: A rapidly developing company in...

Ashdown Group: Application Architect/Developer - Peterborough

Negotiable: Ashdown Group: Application Architect/Developer - Peterborough, Cam...

Day In a Page

Read Next
Benedict Cumberbatch attends a special screening of his latest film The Imitation Game  

Benedict Cumberbatch race row: What's the actual difference between 'coloured' and 'person of colour'?

Matthew Norman
Pressure is growing on Chris Grayling to abandon the Government bid to advise Saudi Arabia on running its prisons (Getty)  

What in sanity’s name is Chris Grayling doing in the job of Justice Secretary?

Matthew Norman
Greece elections: In times like these, the EU has far more dangerous adversaries than Syriza

Greece elections

In times like these, the EU has far more dangerous adversaries than Syriza, says Patrick Cockburn
Holocaust Memorial Day: Nazi victims remembered as spectre of prejudice reappears

Holocaust Memorial Day

Nazi victims remembered as spectre of prejudice reappears over Europe
Homeless Veterans appeal: Homeless in Wales can find inspiration from Daniel’s story

Homeless Veterans appeal

Homeless in Wales can find inspiration from Daniel’s story
Front National family feud? Marine Le Pen and her relatives clash over French far-right party's response to Paris terror attacks

Front National family feud?

Marine Le Pen and her relatives clash over French far-right party's response to Paris terror attacks
Woman who was sent to three Nazi death camps describes how she escaped the gas chamber

Auschwitz liberation 70th anniversary

Woman sent to three Nazi death camps describes surviving gas chamber
DSK, Dodo the Pimp, and the Carlton Hotel

The inside track on France's trial of the year

Dominique Strauss-Kahn, Dodo the Pimp, and the Carlton Hotel:
As provocative now as they ever were

Sarah Kane season

Why her plays are as provocative now as when they were written
Murder of Japanese hostage has grim echoes of a killing in Iraq 11 years ago

Murder of Japanese hostage has grim echoes of another killing

Japanese mood was against what was seen as irresponsible trips to a vicious war zone
Syria crisis: Celebrities call on David Cameron to take more refugees as one young mother tells of torture by Assad regime

Celebrities call on David Cameron to take more Syrian refugees

One young mother tells of torture by Assad regime
The enemy within: People who hear voices in their heads are being encouraged to talk back – with promising results

The enemy within

People who hear voices in their heads are being encouraged to talk back
'In Auschwitz you got used to anything'

'In Auschwitz you got used to anything'

Survivors of the Nazi concentration camp remember its horror, 70 years on
Autumn/winter menswear 2015: The uniforms that make up modern life come to the fore

Autumn/winter menswear 2015

The uniforms that make up modern life come to the fore
'I'm gay, and plan to fight military homophobia'

'I'm gay, and plan to fight military homophobia'

Army general planning to come out
Iraq invasion 2003: The bloody warnings six wise men gave to Tony Blair as he prepared to launch poorly planned campaign

What the six wise men told Tony Blair

Months before the invasion of Iraq in 2003, experts sought to warn the PM about his plans. Here, four of them recall that day
25 years of The Independent on Sunday: The stories, the writers and the changes over the last quarter of a century

25 years of The Independent on Sunday

The stories, the writers and the changes over the last quarter of a century