Energy Prices: The Facts

kamsandhu —  November 26, 2013 — Leave a comment

Today, Fuel Poverty Action will stage a demonstration against the Big Six, outside the Npower offices. You can find out more info about the event here.

Energy prices have gone up 37% since 2010 – eight times the average wage increase since then. The decision of heating or eating is a very real prospect for many families and individuals up and down the country, as the number of people using foodbanks also continues to rise.

With the Big Six Energy companies, who are Npower, Scottish Power, E.On, EDF, British Gas and SSE, increasing their prices by a further 8-10% just before winter, the rates of fuel poverty continue to rise and over 24,000 elderly deaths are expected as a result of cold homes.

Image: The Guardian

Image: The Guardian

The energy companies insist that the reason for the steep increases is due to wholesale price rises, but this is not true. As this graph shows, wholesale prices have actually gone down since the recession first hit in 2008 (thanks to Tom Pride’s blog):

Image: Pride's Purge - tompride.wordpress.com

Image: Pride’s Purge – tompride.wordpress.com

When Ed Miliband promised to freeze energy prices for 18 months should he be elected in 2015, he was shouted down by Conservatives who claimed this could not be done because energy companies could raise prices before and after. Still, this brought the struggle to meet these bloated price rises to the forefront, and also highlighted the extent to which the country is being held to ransom by the Big Six.

Cameron now wants to drop the ‘green levy’ having been put under pressure to deal with the cost of living. But this is another step in the favour of energy companies and not the public.

The ‘green levy’ or Climate Change levy makes up around 9% of the average bill, around £112 of £1267 yearly bill. This money goes to creating renewable energy sources such as wind-farms and solar power as well as money towards helping the elderly and the poor with their bills.

Dropping this levy has been lobbied for by the Big Six, and the impact will only serve to bolster their profits, whilst energy alternatives are pushed further and further back, and money is taken from those that already desperately need it and will need it even more following the price rises. Dropping the green  levy does nothing to stop or challenge the energy companies in charging anything they want. This is a cowardly and short-sighted move by Conservatives to avoid upsetting the Big Six.

Allowing energy companies to become this powerful and collude in raising prices has highlighted a huge problem in privatisation and the selling off of public services. A recent YouGov poll showed that much of the public would like to re-nationalise many of our services including energy and railways:

Support for nationalisation

Meanwhile, thousands of people are continuing to face the decision of whether to heat or eat. This is why Fuel Poverty Action is protesting today, as energy price rises sign the death certificates of the most vulnerable this winter, in the name of profit. To combat the power which the Big Six hold over Britain, government need to make some bold steps to regain parts of its services. Dropping the green levy will not help our future resources or the most vulnerable and it won’t stop the energy companies from continuing to hike up their prices.

 

by Kam Sandhu @KamBass

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kamsandhu

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kambass@hotmail.co.uk

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