The truth about energy pricing
Our energy prices are rigged. We could make it affordable for all, but the Government and Ofgem have allowed profiteering to inflate pricing. Instead of giving us the benefits of increased low-cost renewable electricity, the price is increased to match the most expensive gas fired power stations. Gas pricing itself is pumped up by gas suppliers and traders exploiting any bad news globally.
The result of this blatant profiteering is unaffordable energy and huge windfall profits, nearly £500 billion in four years. The “energy crisis” was a bonus bonanza for energy bosses and shareholders. As energy prices shot up, we got colder and poorer. Government subsidies meant £40 billion of public money ended up with energy firms.
Even now, our bills are about 70% higher than 2020, and despite the Government’s promise of a £300 bill saving by 2030, they are resisting the fundamental market reforms needed to make that happen. High prices mean high profits, which attracts the overseas investors they crave. The millions of us that will freeze as a result are collateral damage.
Despite the Government’s Clean Energy Mission, it’s our renewable electricity that is most overpriced and four times more than gas. This causes severe hardship for those of us with electric heaters (often older and at-risk) and also undermines the switch away from gas. We could have clean and affordable energy, and free energy when supply is higher than demand. Instead we pay energy firms hundreds of £millions (soon to be billions) to waste our wind. The Government resists reform, and even penalises us for using clean energy by adding levies.
There are many more specific injustices in energy pricing that cause immense harm. Instead of protecting us, Ofgem Is Failing Us on price discrimination (link), Standing Charges (link), Heat Networks (link).
Greater public and political pressure is needed to overcome industry lobbying and force real market reform.
For more information and inspiration, check out our Fuel For Thought sessions.
