Energy bills are back in the news, with the Office of Budget Responsibility calculating new figures for the cost of low carbon power, the Competition and Markets Authority investigating energy companies, and both IPPR and Policy Exchange releasing reports in the past few weeks. With so much to debate, and a lot of seemingly conflicting numbers to grasp, here are five things you should know:
1. The levy control framework (LCF) makes up three per cent of the average energy bill.
The claim that government controls a large proportion your energy bill rests mainly on the costs of electricity and gas networks, which make up around 22 per cent of bills. In contrast, efficiency policies, which reduce consumption, and therefore lower bills, make up around three per cent. Low carbon power, covered by the levy control framework, also makes up just under three per cent of the bill. So called ‘policy costs’ are, therefore, mostly due to networks, not low carbon power. Read more