Supporting low-carbon energy will raise energy bills by up to 17 per cent by 2020

Investment in low carbon energy will add £55 pounds to household energy bills and raise business’s energy bills by up to 17 per cent by 2020, the Committee on Climate Change (CCC) has estimated.

Business bills are predicted rise by a further 12 to 25 per cent to 2030 due to low-carbon policies. The estimates were made by the CCC in their report ‘Energy prices and bills- impacts of meeting carbon budgets’.

The CCC also said that household bills would increase by £75 from 2020-2030 largely due to increases in the carbon price.

The report found that the primary cause of increases in energy bills since 2004 was the international price of gas and investment in networks.

Low-carbon policies and energy efficiency measures only accounted for £1 each in every £10 increase between 2004 and 2013.

Of a typical household energy bill in 2013 of £1,140, £55 a year went on supporting the cost of energy efficiency schemes and £45 supported low-carbon energy.

Energy efficiency schemes installed 200,000 new boilers and heating controls, and insulated almost 200,000 homes in 2013. Of those that the schemes helped 40 per cent were low income families.

The report also said that continued improvements to energy efficiency could offset all the expected increases to household bills by 2030, and at least some of the increases for businesses.

CCC chairman Lord Deben 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 life-style.”