Chancellor George Osborne recently announced a £7 billion energy bill cut for UK-based manufacturers, as part of a long-term effort to reduce costs for businesses in Britain exporting products overseas. The cut will also apply to certain households, largely to reduce the pressure on consumers struggling with everyday expenses.
The cost of energy has become a major economic issue for many in Britain. Over the last month, reports have emerged of food banks preparing special ‘cold packages’ of products that can be consumed without heat. Others have reportedly dealt with a growing number of beneficiaries turning down food that requires cooking.
The package offered by George Osborne includes a freeze to the carbon tax, which is currently charged to major carbon dioxide emitters in the manufacturing sector. The carbon tax freeze will occur for ten years from 2016 and cap taxes at £18 per tonne, rather than the £30 per tonne that businesses would otherwise need to pay.
As a result of the tax freeze, large manufacturers could save as much as £50,000 per year in energy expenses. The average UK household would also benefit from the tax freeze, enjoying a £15 per year saving in energy bills. The package also includes a £1 billion payment to firms that require a lot of energy to compensate for green levies.
Numerous leading manufacturers have criticised the carbon tax, stating that it sets back British manufacturing and creates unnecessary costs for manufacturers. Most of the criticism revolves around the tax’s relatively minor impact on global carbon dioxide output in comparison to its massive cost for UK-based industry.
Manufacturing has grown at a steady pace as the economy has moved back into a growth phase. The 2014 budget is part of a long-term effort by the government to ensure that this growth is steady and to keep costs relatively low for both British households and leading manufacturers.Read more
British households are reducing their energy consumption as high prices make it increasingly more expensive to run a modern home. New data from the Office for National Statistics indicates that UK households have reduced their energy usage by 25 percent over the past six years.
The biggest motivating force for reduced energy consumption has reportedly been the increasing cost of energy. The average fuel bill has increase by more than 160 percent in the last nine years – from just £522 in the beginning of 2004 to £1,350 during the early months of 2013.
Analysts have expressed concern that the massive increase in energy pricing has left many Britons unable to adequately heat their homes during winter. In response, the country has reduced its energy consumption drastically, to a level that many believe simply isn’t sustainable throughout winter.
As millions of consumers near the end of their fixed-rate energy tariffs, it’s possible that prices could continue to increase for much of the country. Experts warn that it’s vital for consumers coming to the end of a fixed-rate tariff to carefully plan out their long-term energy plans to avoid being ripped off by increasingly high prices.
The Office for National Statistics Report indicates that a 28 percent increase in the cost of energy has occurred in the last three years alone, confirming many Britons’ beliefs that it’s becoming significantly more expensive to maintain a normal standard of living. Harsh climates resulted in some residents being hit with far more costly energy bills than others.
Scotland, for example, managed a modest 14 percent decline in energy consumption over the past six years – a figure that was almost doubled by England. Experts have stated that Scotland and cool regions of England will be affected the most by rising energy costs, as harsh winters make it less practical to reduce energy usage.Read more
As the cost of energy rose by at least 140 percent within the past eight years, it has become the number one worry amongst Britons already cash strapped by a double dip recession. In fact, the cost of energy has increased seven times that of the average household income in the past eight years.Read more
Mounting protests have been staged in the UK, despite government’s efforts to assure consumers that they are doing everything humanly possible to help curb the rising cost of energy bills. Not only is government making it mandatory for companies to advise consumers in writing if there are cheaper plans available, but they are also in the midst of an £11 billion rollout of smart meters which are supposed to make energy consumption more efficient.Read more
On 7 February the announced EDF gas price cuts will come into effect but this 5pc difference will offer little relief to customers who will still be paying an average of £166 more annually than they had just two short years ago. It is estimated that energy bills will be dropped to about £1,203 which is down from £1,241 which consumers had been paying in 2010.Read more
According to the newest figures released by Money Supermarket, it is estimated that seven of every ten consumers in the UK will need to use credit, savings or overdraft protection to pay for the rising cost of energy.Read more