Low-carbon energy subsidies equivalent to taking 10 million cars off the road

A new report from the Committee on Climate Change (CCC) found that low-carbon energy policies made up £45 of energy bills in 2013, resulting in emission reductions equivalent to taking 10 million cars off the road.

The report – Energy prices and bills – impacts of meeting carbon budgets – is the third assessment of the impact of carbon budgets on energy bills undertaken by the CCC.

Last year, the average householders energy bill stood at £1140, with energy efficiency schemes accounting for £55 and £45 supporting low-carbon electricity. A high portion of the money going to energy efficiency schemes goes to low-income families in order to install measures to reduce heating costs, such as insulation and new boilers, and as a result cutting their carbon footprint.

Lord Deben, chairman of the CCC, said, “Last year, as energy consumers we all helped hundreds of thousands of poorer people to have warmer homes and contributed to real reductions in our emissions in the fight against climate change – all for around £100 a year on the average bill. Many people saved more than that by taking simple energy saving measures that didn’t interfere with their lifestyle.”

Despite some reports stating that low-carbon policies are the cause of rising energy bills, the report suggests that this is not the case. Since 2004, the increasing international price of gas and investment in electricity and gas networks have accounted for the majority of bill rises. The CCC suggest that low-carbon policies and support for energy efficiency improvements have accounted for around £1 in every £10 increase in household bills from 2004 to 2013.

In order to meet the UK’s carbon budget the CCC expect a further £55 to be added to the average annual bill by 2020. However, with strong policies the report argues that opportunities to improve energy efficiency could offset all of the impact to households.

Photo: Lee Haywood via Flickr 

Further reading:

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Stronger EU renewable energy targets could rid need for subsidies

EU approves UK’s renewable subsidy scheme and capacity market