Energy Bills: £400 in Hidden Profits on Every UK Bill

For many, the fuel poverty crisis continues with no end in sight. Average energy bills are stuck at nearly 70% above five years ago. Instead of Labour’s promised £300 saving, households have felt an increase of £187.

The human cost is enormous.

Thousands of people are dying each winter due to cold, damp, mouldy homes. Cold and mould related illnesses overload the NHS each winter. Energy deprivation and bill-related stress also contribute to an epidemic of anxiety.

A key part of the solution to high energy prices was supposed to be cheap, clean energy from renewables.

We’ve expanded generation, but electricity prices have soared. We are being charged four times more per unit for electricity than gas.

This causes extreme energy deprivation for the two million homes dependent on traditional electric heating, and undermines our transition from gas and oil boilers to heat pumps.

Those with electric heating have the lowest incomes and the highest incidence of fuel poverty. Our energy pricing system is even more regressive when you consider standing charges.

Standing charges for electricity have doubled, loaded up with government levies. This cruel form of hidden taxation hits those with the least the hardest. Millions are driven into severe energy deprivation, with those on prepayment meters getting cut off completely.

The Ofgem plan to introduce so-called “standing charge free” tariff options — which simply hides the charge in unit costs — is not the solution. Instead, government levies and taxes should be moved to progressive taxation, bringing down standing charges and electricity pricing. And low energy users should not pay any standing charges at all.

Other changes are needed too.

Government must end the absurdity of the price of renewables being driven by the most expensive gas generation source. This not only increases fuel poverty, but also fuels the myth that renewables are the cause of, not solution to, high electricity prices.

Government and Ofgem must also cap the profits of the energy industry — about £400 of our energy bill is energy industry profits. Many are hidden in less obvious places like the distribution network operators, grid and energy traders.

We should all have the energy we need for the basics of life. That’s why we are calling for Energy For All, with a petition signed by 660,000 people and handed to Keir Starmer. It’s time to build an energy system that works for people, not profit.