Energy bills to rise to meet investment needs
December 6, 2010 at 2:10 pm
There was yet more bad news for energy customers recently as Ofgem warned that energy bills could double over the next ten years to raise the £32 billion needed to upgrade Britain’s energy network.
Much of the network was constructed in the 1950s and 1960s and is becoming unsuitable to deal with the way that consumers are using energy, as we shift to a low-carbon economy. By upgrading the pipes and wires in the network, the UK will be able to guarantee its energy supplies in the future.
Alistair Buchanan, the chief executive of Ofgem, said on the BBC Radio 4 Today programme that bills could add £6 a year over the following ten years.
However, comparison websites and consumer groups have been quick to heap further misery on energy customers by revealing that we could be facing much larger hikes of between 50% and 100%. They claim that Ofgem is only referring to the price rises which will be required to transport the energy, whereas as gas becomes scarcer over the coming years this will also lead to further price increases.
This would see the average bill come to over £2,000 over ten years, a shocking thought for the majority of energy customers.
The warnings follow on from the news that energy companies have recently witnessed a rise in wholesale prices. Wholesale prices are predicted to rise by 13% by the time spring arrives. If the full price increases are passed on to customers then this could see the average annual gas bill rise by £81.
