POWER BLACKOUTS 'COULD HIT BRITAIN'

 
Power blackouts could blight Britain unless the Government takes urgent action, the chairman of an influential House of Commons committee has warned.

"The concern that people have about prices will be a picnic compared with significant numbers of power cuts," said Peter Luff, chairman of the business and enterprise committee. "People could find they are watching the telly and suddenly it goes off for an hour or two. That possibility is real. It still can be avoided but we are losing time."

The committee published a report which warned new capacity to store gas and generate electricity must be created if a "disastrous" energy crunch is to be avoided.

The report, Energy Policy: Future Challenges, said difficult economic conditions make it less likely that energy companies will make the necessary investment to safeguard future supplies. It said "it is the Government's job to ensure security of supply" and urged a rethink of its faith in the market.

The committee said there is a "high risk" that energy companies will not be able to raise the money to replace capacity lost when old nuclear and coal-fired power stations are decommissioned.

"Generating capacity equivalent to nearly a third of current electricity demand will be made redundant by 2020. It will need to be replaced," the report said. "Just as the Government has been quick to respond to the crisis in the banking sector, it must now take action to ensure investment in new capacity takes place as planned.

"The situation is now very serious and we believe that a simple trust in the market's ability to deliver without any intervention will see us facing an 'energy crunch' in the medium term. The social and economic consequences of such a 'crunch' would be disastrous."

The report said gas storage capacity needs to grow "if the UK is to avoid falling victim to even higher levels of wholesale gas price volatility in the coming years". "We think it likely that the market will fail to deliver," the report concluded.

David Porter, chief executive of the Association of Electricity Producers, said: "We are fast approaching a 'generation gap' and about £100 billion needs to be spent on new and greener power stations. It is absolutely vital that the Government should always try to ensure that the UK is an attractive destination for investment in new energy infrastructure. If it fails to do that, the consequences could be dreadful."  continues here

Gas and electric bills rising twice as fast in Britain as in Europe

Energy bills are rising more than twice as fast in the UK as in neighbouring nations, it emerged yesterday.

The figures raise fresh questions about foreign firms 'picking the pocket' of UK consumers.

Gas and electricity prices in Britain have risen by 29.7 per cent in the past year, the Organisation for Economic Cooperation and Development revealed.

This compares with the European average of 14 per cent and just 8.1 per cent in Portugal.

The OECD, made up of the world's 30 richest nations, is one of the most prestigious economic bodies in the world.

It found that Norway is the only other developed nation facing higher price rises than Britain.

Ed Mayo, chief executive officer of the new super-watchdog Consumer Focus said: 'The UK energy consumer is being clobbered faster and harder than those in Europe.

'Other countries may be doing more to keep their prices down and we should learn from them.

'The UK has a relatively free market, but the freedom to cut prices in the early years seems now to be the freedom to raise prices with impunity.

'Of course, those least able to afford it suffer most.'

Earlier this year MPs revealed the massive increases are down to European power monopolies refusing to sell our own gas back to us and effectively holding the UK to ransom.


Britain is no longer self-sufficient in gas from the North Sea and has become reliant on imports during the winter.

Foreign power firms are buying cheap British gas in the summer, storing it, then refusing to pipe it back when it is needed in the winter, effectively rationing supplies and pushing up prices.

The UK is vulnerable because it only has enough storage to supply the country with gas for 13 days, compared with 99 days in Germany and 122 in France.

Britain is also more reliant on the gas market, unlike France which obtains 37 per cent of energy from nuclear power. continues here

Energy giants 'prey' on poor forced to use pre-pay meters

Energy companies are charging people on pre-payments up to £567 a year more than wealthier customers on internet tariffs, a government-funded consumer group has found.


In the last report before its abolition, Energywatch accused the energy firms of "preying" on poor customers who could not move to cheaper tariffs because of debt problems.

Poorer customers buy credits for their electricity and gas supply to load into the meters rather than pay monthly or quarterly. But the big six energy companies charge them far more than other customers. In January, The Independent disclosed that customers with pre-payment meters are charged 10 times more than the energy companies pay back to vulnerable customers on little-publicised "social tariff" schemes.

One million of the five million pre-payment customers are classed as being in fuel poverty by Ofgem, the electricity regulator.

In an investigation, the consumer group Energywatch found that British Gas – biggest of the big six energy companies and the one which spends the most on its social tariff – charged pre-payment customers the most of all its rivals, £567 more than its cheapest deal.

The disparity was next greatest at the German-owned firm E.on, which charged pre-payment clients £411 more than those on its cheapest deal, followed by Npower £378, ScottishPower £172, and Scottish and Southern £167. EDF has no equivalent tariff.

Allan Asher, Energywatch's chief executive, said: "Energy suppliers are preying on their poorest customers with discriminatory tariffs that squeeze extra revenue out pre-payment meter-users, which includes many of those least able to afford to pay their energy bills and least able to switch."

The Energy Retail Association said pre-payment meters offered customers flexibility and the ability to budget, and most were in rented homes, holiday lets and student accommodation. "According to Ofgem figures, just 20 per cent are used by the fuel poor," the trade body said in a statement. "Therefore equalising all tariffs would mean that those in fuel poverty who do not pay this way would subsidise the small percentage who are." continues here