Government push back could cost households more than £8 billion
Picking up on a comment made by Labour MP Ed Miliband today (21/09/2023), Policy changes announced yesterday by the PM Rishi Sunak could cost British households almost £8 billion in higher bills over the next decade.
According to new analysis by the Energy and Climate Intelligence Unit (ECIU) it suggests that the cost could go even higher if gas prices spike again based on the government cancelling new energy efficiency regulations for the private rental sector.
It also points out that there could be further impacts on household bills due to changes to the phaseout of oil boilers for off-gas grid homes. Costs to the NHS due to poor housing could also reach £1.2bn a year, or £12bn over the next decade experts have estimated.
The report goes onto the state the if gas demand remains high across the economy, the UK could pay an extra £150bn over 10 years to overseas gas producers, compared to if the government introduced policies to ambitiously cut gas demand through the introduction of heat pumps to heat our homes.
Commenting on the report, Jess Ralston, Energy Analyst at ECIU, said that the new policy changes: “looks chaotic and not the way long term policy should be made around important issues, with emergency cabinet meetings and investors spooked.
“Quite the opposite of an honest debate, the implication that any of these policies were going to affect the cost of living here and now is untrue. In fact, the Prime Minister has sided with landlords over renters, putting their energy bills and cost of living up by ducking the improvement of rules on energy efficiency.
“That doesn’t make any sense when excess cold in homes costs the NHS £1.2 billion per year and renters are amongst those with the lowest incomes. As the North Sea declines, if the UK fails to shift to heat pumps, we’ll end up reliant on importing ever larger quantities of foreign gas.”
The move to becoming net zero was never going to be a smooth journey and it does appear that the UK Government will need to adapt as we move towards the 2050 target.
It has never been more important as a business owner to keep a track of wholesale energy market trends to help make a more informed decision when your energy contract is nearing its renewal date.