Energy efficiency measures offset price rises

The average dual fuel bill actually fell by £6 last year due to improved energy efficiency amidst the furore over price caps, according to a new report.

Published by the Energy and Climate Intelligence Unit (ECIU), the report updates an analysis of energy prices carried out by the Committee on Climate Change (CCC) last year.

This showed that since the introduction of the Climate Change Act in 2008, the average annual energy bill had fallen by more than £100 due to measures such as more energy efficient appliances.

The updated analysis shows that average electricity and gas bills fell by £6 between 2016 and 2017 once fluctuating weather and hence energy demand was taken into account.

Without this adjustment, the report says the average bills would have been £36 lower. The improvements in energy efficiency are more than offsetting price rises introduced by the energy companies, the ECIU says.

However, the report says the government, regulators and companies are not reflecting these falls because their reporting is based on the assumption that average household energy use is constant.

It says: “Constant year-on-year increases in energy bills may well have led to higher concern on energy bills than the figures actually merit.”

A YouGov survey of MPs carried out by ECIU shows that legislators share the widespread ignorance about these falls.

It shows that just one per cent know that energy bills and demand are falling and two-thirds (63 per cent) reckon both are rising.

The survey also shows that nearly three-quarters of MPs agree that the government should provide financial support for home insulation measures as a way of improving energy efficiency.

Commenting on the findings, James Heappey, MP for Wells and a member of the ECIU advisory board, said: “As the polling shows, it’s a good news story of which the vast majority of my colleagues in parliament are unaware – and that’s something we have to change.”

Richard Black, director of ECIU, said that the findings highlighted the need for clear, accessible evidence to help inform policymakers and other stakeholders.

“It’s not surprising that MPs are unaware of the long-term trend of falling energy bills given the continuing furore over price rises.”

“But even though the big six’s tariff hikes are real and do create problems for vulnerable customers, this shouldn’t hide the wider reality that measures to cut energy waste work – reducing energy demand, cutting carbon emissions and driving energy bills downwards.

“As the Committee on Climate Change has observed, though, there is currently a big hole in policymaking on energy efficiency, despite the huge popularity of such measures in the country. So it’s noteworthy that such measures also command widespread support across the House of Commons.”