UK firms face 20% hike in energy bills

24th November 2011


Related Topics

Related tags

  • Manufacturing ,
  • Energy ,
  • Business & Industry ,
  • Management/saving ,
  • Renewable

Author

IEMA

Companies in the UK are likely see energy costs rise by up to 20% by 2020 as a result of the government's climate change policies, confirms energy secretary Chris Hune.

In announcing the government’s annual energy statement yesterday (23 November 2011), Hunhe acknowledged the policies in place to improve energy efficiency across the UK were typically going to add 19% to energy bills for the average medium energy consuming businesses and up to 20% for energy-intensive organisations.

Hunhe went on to renew government pledges to assist businesses, particularly those in energy-intensive sectors, in coping with increased energy costs.

“It is important that these industries remain competitive,” he said. “That is why we are working with the business department and the Treasury to announce measures before the end of the year to support those energy-intensive industries whose competitiveness is most at risk.”

EEF, the manufacturers’ organisation, reacted to the announcement by highlighting its findings that energy-intensive organisations are already paying 10% more than their German competitors, due in part to government policy, and that this is likely to widen to 15% by 2013.

“The analysis released today reinforces the urgent need for measures to safeguard the jobs and investment in Britain’s energy-intensive industries,” warned Steve Radley, EEF director of policy. “The government needs to get a firmer grip on the energy costs most directly under its control – those arising from its own policies. Failure to do so could threaten future investment in the manufacturing sector.”

Meanwhile the CBI welcomed government’s acknowledgement of the role that short-term energy costs plays in organisations’ deciding whether they can keep operating in the UK, but warned that policy certainty was the key to enabling the move to a low-carbon economy.

“The solution to energy prices in the long-term is to attract new investment in low-carbon infrastructure,” said Rhian Kelly, CBI director for business environment.

“We need the right policies in place to help reduce energy bills and attract essential investment for more secure, affordable and low-carbon energy infrastructure. Following the government’s recent unexpected changes to the solar feed-in tariff, it still has a long way to go to build business confidence.”

While the response from industry was mixed, DECC’s figures were welcomed by the renewable energy sector. It argues the data counters accusations in the mainstream press that support for renewables is resulting in larger household energy bills.

“The figures demonstrate this simple truth – that green measures, far from being expensive, can actually save us money,” said Maria McCaffery, chief executive of renewable energy trade association RenewableUK. “The 18p we’re paying for wind power now means our bills will be lower in the future – and we’ll have tens of thousands of new green-collar jobs, thanks to that investment.”

The estimates from DECC conclude that energy and climate change policies currently add 2% to the average household energy bill, and by 2020 energy efficiencies resulting from support for renewable energy would see consumers save 7% (£94 a year) on the cost of heating and powering their homes compared to what they would pay in the absence of such assistance.

Subscribe

Subscribe to IEMA's newsletters to receive timely articles, expert opinions, event announcements, and much more, directly in your inbox.


Transform articles

Swing voters show strong support for renewables

There is strong support for renewable energy as a source of economic growth among UK voters, particularly among those intending to switch their support for a political party.

16th May 2024

Read more

A project promoter’s perspective on the environmental challenges facing new subsea power cables

3rd April 2024

Read more

The UK’s major cities lag well behind their European counterparts in terms of public transport use. Linking development to transport routes might be the answer, argues Huw Morris

3rd April 2024

Read more

Tom Harris examines the supply chain constraints facing the growing number of interconnector projects

2nd April 2024

Read more

The UK government’s carbon capture, usage and storage (CCUS) strategy is based on optimistic techno-economic assumptions that are now outdated, Carbon Tracker has warned.

13th March 2024

Read more

The UK government’s latest Public Attitudes Tracker has found broad support for efforts to tackle climate change, although there are significant concerns that bills will rise.

13th March 2024

Read more

A consortium including IEMA and the Good Homes Alliance have drafted a letter to UK government ministers expressing disappointment with the proposed Future Homes Standard.

26th February 2024

Read more

Global corporations such as Amazon and Google purchased a record 46 gigawatts (GW) of solar and wind energy last year, according to BloombergNEF (BNEF).

13th February 2024

Read more

Media enquires

Looking for an expert to speak at an event or comment on an item in the news?

Find an expert

IEMA Cookie Notice

Clicking the ‘Accept all’ button means you are accepting analytics and third-party cookies. Our website uses necessary cookies which are required in order to make our website work. In addition to these, we use analytics and third-party cookies to optimise site functionality and give you the best possible experience. To control which cookies are set, click ‘Settings’. To learn more about cookies, how we use them on our website and how to change your cookie settings please view our cookie policy.

Manage cookie settings

Our use of cookies

You can learn more detailed information in our cookie policy.

Some cookies are essential, but non-essential cookies help us to improve the experience on our site by providing insights into how the site is being used. To maintain privacy management, this relies on cookie identifiers. Resetting or deleting your browser cookies will reset these preferences.

Essential cookies

These are cookies that are required for the operation of our website. They include, for example, cookies that enable you to log into secure areas of our website.

Analytics cookies

These cookies allow us to recognise and count the number of visitors to our website and to see how visitors move around our website when they are using it. This helps us to improve the way our website works.

Advertising cookies

These cookies allow us to tailor advertising to you based on your interests. If you do not accept these cookies, you will still see adverts, but these will be more generic.

Save and close