On August 8th 2011 I wrote on this site that energy prices were the biggest political issue needing attention. Many now seem to agree with me. The cost of EU and UK energy policy is increasing, just as some of us feared. In the last two weeks has come the shock announcements of major hikes by two of the big six energy companies, meaning even bigger bills ahead. The high cost of renewable energy, carbon taxes, emissions based closures, and the costs of closing and replacing older oil, coal, and nuclear plant is catching up with us.
When I checked my bill I noticed it had gone up not just because gas and electricity are dearer, but also because I have used more gas for heating over the last year. I well remember that as late as May I was getting up when the outside temperature was just a few degrees above freezing. On more occasions the central heating triggered because it was so cold. It also started to deliver cold evenings before August was out.
It is one of those ironies as we tackle global warming that in recent years in the UK we have had some colder and longer winters. Whilst we did at last get some hot days this summer, it felt autumnal in the early morning and in the evening before August was out. Before adjustment, the heating started to trigger early again.
Many, especially the frail and elderly, will not be able to cut the increase in their bills by using less, as they are already on prudent settings and need to keep warm. Indeed, if we have a very cold long winter they may have to use more, not less. The government should be generous to the ill and the elderly who have to incur higher bills, through its pensions and disability benefit increases, cold weather payments and the like.
I will continue to press for cheaper energy. Household bills are too high primarily because the fuel cost is too high. The industrial revival the government seeks will need much more cheaper energy to power it. The EU experiment with very expensive renewable power from unreliable sources like wind will not power our factories or keep us warm on a regular basis. To do that we will need those standby power stations burning gas.
An energy price freeze which does not include protection against wholesale energy price rises cannot help. Nor does it help if you need to burn more to keep warm. The underlying reality is that Mr Miliband, Labour and the EU signed us up to much dearer energy than the US or Asia enjoys. There may be arguments at the margin over how much of the great extra cost is paid for by customers, and how much by taxpayers in subsidies. As they are largely the same people it does not make a lot of difference. What matters is when and how we are going to cut loose from the very dear energy strategy we are locked into.
I am told the government is working on ensuring the older standby coal and oil stations to generate electricity are available should need arise. Next year they intend to secure back up supplies for days when not enough wind blows. It just serves to remind us of the extra costs the renewables policy is imposing, as both these methods of ensuring security of supply cost extra. The government has started to cut the allowable costs of renewables and needs to do more in that direction. The way to cheaper energy is through an energy mix that is more based on lower price and efficiency.
This crisis has been building for more than a decade.Previous posts include:
August 8 2011 Energy prices
May 18 2012 Cheap energy can be energising
July 29 2012 Green energy makes some people see red
August 28 2012 Germany switches to coal
December 5 2012 Drill Davey, drill
March 27 2013 Letter to the Energy Minister
April 27 2013 The UK needs cheaper energy for an industrial revival
June 29 2013 Keep the lights on Mr Davey