Are you willing to pay more to meet new carbon cutting plans?
The government has announced new targets for carbon reduction, but it means higher energy prices. So how do you feel about carbon reduction? It might be good for the environment, but what about your wallet?
It seems like you can’t turn on the radio or look in a newspaper at the moment without seeing yet another warning of energy price rises.
Last week, British Gas and then the Governor of the Bank of England said that we should expect bigger gas and electricity bills this winter. And this week, the Government thrashed out a ‘historic deal’ on climate change, which entails even more pain for consumers’ wallets. Or does it?
Government’s climate change plans
When the energy and climate change secretary Chris Huhne announced the Government’s carbon reduction commitment to cut carbon emissions in half by 2027, he made a key pledge – it would result in no additional cost for consumers for the next four years.
Phew, right? Well, yes, this is good news – for now. But even with this announcement, we should all expect our energy bills to keep going up, up, up.
So what are consumers to do? Should we just shrug our shoulders and accept that energy costs are going to steadily become an even bigger part of our monthly budgets? And that more and more people will slip into fuel poverty?
Or maybe we should spend even more money to make our homes energy efficient. After all, insulating our houses and flats is probably the best way to save money in the long-term. But where to start? Maybe with loft or cavity wall insulation? Or perhaps by installing solar panels or heat pumps?
Sadly this confusion seems to characterise our experience of the energy market. Not only are we faced with confusing bills and energy tariffs, but there’s evidence of dodgy sales and marketing practices.
No wonder we feel powerless about energy price rises.
Why isn’t the public being consulted?
So, with the government sealing a deal to drastically cut carbon emissions, isn’t it time for a similar deal on energy prices? Government seems to be listening to businesses, energy companies and the environmental lobby – but shouldn’t they be talking to people who will end up paying for this investment in their future energy supplies?
Central to this discussion is the need to be honest with the public. Lots of different figures are thrown out into the media about the expected price rises. And the reasons for the soaring energy bills are complex – wholesale energy costs, commodity prices, future investment in generation, environmental and social obligations, issues with global demand and so on.
So could all the main energy players – government, energy companies, green groups and consumer organisations – do more to work together and explain how and why prices are going to increase?
It’s no good to simply scaremonger about future prices. With inflation continuing to rise and further tough economic years ahead, we need to find ways to give people a fighting chance of controlling their energy bills.
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