Energy UK has unveiled a series of groundbreaking proposals aimed at alleviating the financial burden of skyrocketing energy bills for British households. The industry body recommends encouraging households to alter their energy consumption patterns, such as using appliances during periods of low demand and capitalizing on times of excess wind and solar energy. These measures are part of a broader initiative to promote energy flexibility and efficiency.
Simultaneously, local authorities and social housing providers have begun distributing £1.8 billion in government support. This funding specifically targets low-income households and social housing tenants, providing much-needed relief in the face of rising costs. These initiatives come on the heels of a contentious report published by Energy UK, which accuses Ofgem, the energy regulator, of "unreasonable and unprofessional behaviour."
"Clean power is the only way to permanently deliver both energy security and stable, affordable bills, but the benefits are some way off," – Dhara Vyas, Energy UK’s chief executive.
According to Energy UK, the government's strategy to transition to a clean power system by 2030 holds the promise of significantly reducing energy bills in the next decade. The organization has also recommended a shift in how policy costs are allocated. By moving these costs from electricity to gas and supplementing them with general taxation, it is estimated that households with electric heating could see a reduction of up to £400 annually.
Energy UK's research highlights that families equipped with "flexibility equipment," such as batteries, heat pumps, or electric vehicles, could potentially save £115 annually by optimizing energy use during off-peak times. Despite these promising strategies, Energy UK warns that the positive effects on household bills may not materialize before the end of this decade. The organization criticizes ministers for not establishing a clear action plan to reduce household expenses.
"Successive governments have failed to tackle the dual challenge of how we fairly pay for the crucial investments in our energy system and bring prices down for bill payers," – Dhara Vyas, Energy UK’s chief executive.
The pressing issue of customer debt, which has reached an unprecedented near £4 billion, underscores the urgency of these reforms. Moreover, Ofgem's recent price cap adjustment will result in the average gas and electricity bill for a typical household in Great Britain increasing by £111 from April to £1,849 annually. This adjustment will impact millions of UK households, exacerbating financial pressures.
Energy UK's findings suggest that reducing dependence on imported gas is essential for achieving long-term reductions in energy bills. The volatility of wholesale gas prices, driven by geopolitical events, presents a persistent challenge for maintaining affordable energy costs.