Electricity price projections
The UK Government, through the Department of Energy and Climate Change (DECC), tracks electricity prices relative to their price level in 2005 (equivalent to 100%). Between 2005 and 2011, electricity prices increased to 163% of their 2005 levels and by over 20% since 2010. In 1987, electricity cost just 65% of what it did in 2005.
Electricity price rises since 1987 (DECC)
Global energy prices will continue to rise while supplies of fossil fuels fall. According to Ofgem, higher gas prices have been the main driver of energy bills over the last eight years. Britain first imported more gas than it produced itself in 2004, which means that since then global energy markets have had a big affect on UK electricity prices.
“Between now and 2020 Britain needs to invest up to £200 billion to meet its environmental targets and to secure energy supplies. At the moment, the cost of Government environmental and energy efficiency programmes adds around £100 on to the average energy bill of £1,300. However, greater reliance on non-fossil fuels such as nuclear and renewables, could reduce Britain’s dependence on gas imports.” Ofgem
Analysts have warned that families face a 50 percent rise in their gas and electricity bills over the next four years. Deutsche Bank forecasts that the average dual-fuel bill could rise by 30 per cent to 50 per cent in the next four years – to between £1,300 and £1,600. That would be between £170 and £470 higher than existing bills.
What you can do?
By investing in solar you can generate your own electricity, which will help you to keep your bills down. In fact, the more that grid electricity prices rise, the better off you’ll be if you have your own solar installation.
Financially speaking, solar power rewards you in three ways:
- you get paid for every unit of electricity that you generate
- you get paid an additional amount for any electricity that you feed back in to the grid
- when you use the electricity that you generate yourself, you save money by not having to buy it from your supplier
Read more about solar PV here