By David Derbyshire
Last updated at 8:15 AM on 9th June 2011
Hidden green taxes now make up a fifth of every household’s gas and electricity bills, energy campaigners warned last night.
Cash strapped families pay an average of £200 a year in stealth levies to subsidise Britain’s massive expansion of wind farms, solar panels and ‘environmentally friendly’ heating schemes.
Yesterday outraged campaigners called for an end to the secret subsidies and demanded power companies reveal how much their customers are paying for climate change policies .
Hidden green taxes make up a fifth of households’ gas and electricity bills, energy campaigners warned
The call came as the former head of the civil service, Lord Turnbull, demanded that politicians ‘stop frightening us and our children’ about the threat of global warming.
He demanded that Whitehall and ministers consider the damaging economic impact of blindly following the ‘climate change agenda’.
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The attack on green taxes also came as one of Britain’s biggest power companies unveiled a round of price rises that will add nearly £200 to the average family bill.
Scottish Power blamed soaring wholesale prices for the 19 per cent increase in gas prices, and a 10 per cent rise in the cost of electricity.
But Dr Benny Peiser, director of the Global Warming Policy Foundation, said the soaring price of fuel was also the result of Britain’s ‘stubborn but wrong headed commitment to renewable energy’.
He said: ‘So called green stealth taxes are already adding 15 to 20 per cent to the average domestic power bill and even more to business users’.
Scottish Power has blamed soaring wholesale prices for the 19 per cent increase in gas prices, and a 10 per cent rise in the cost of electricity
Lord Turnbull demanded that politicians ‘stop frightening us and our children’ about global warming
The typical UK household spends £608 a year on gas and another £424 on electricity. Dr Peiser says green stealth taxes make up between £154 and £206 of that bill. For couples with large families – and large fuel demands – the figure is far higher.
‘And yet, despite the growing cost of these taxes, you won’t find any mention of them at all on your gas and electricity bills,’ he said.
‘That, of course, suits the Government down to the ground. If it raised the huge sums required to encourage renewable energy and limit carbon emission through general taxation it would make the Government itself very unpopular.
‘But by doing it through electricity and gas bills, the Government has cleverly ensure that it’s the power companies that take the blame.’
Under the Climate Change Act, the Government is legally bound to cut Britain’s C02 emissions by 34 per cent by 2020 and 50 per cent by 2025.
To meet its targets – the toughest in the world – the Government is encouraging the building of 10,000 wind turbines. It also wants power companies to install £7billion worth of smart meters in homes.
Government wants companies to install £7bn worth of smart meters in homes
The meters record precisely how much gas and electricity a household is using and show how much it is costing, hopefully encouraging households to use less energy.
The meters send this information back to the utility firm, making estimated bills unnecessary.
The drive for wind turbines is being subsidised by the Renewable Obligation – a scheme that forces power companies to buy a proportion of their energy from renewable sources such as wind.
The scheme artificially inflates the cost of coal, oil and gas power, and subsidises green power, making investment in costly wind farms profitable. The cost is passed on in fuel bills.
A second scheme, the European Emission Trading Scheme, forces energy companies and heavy industry to offset greenhouse gas emissions with ‘carbon credits’ – permits that allow them to generate a certain amount of carbon dioxide. Energy companies and heavy industry can offset greenhouse gas emissions with ‘carbon credits’
The scheme has been hit by scandals including tax fraud, the re-sale of used carbon credits and the theft of millions of emission permits.
Once industries have used up their free allocation of credits, they must buy them on the open market – inflating the cost of energy even more.
Bills are pushed up further by the Carbon Emissions Reduction Target – which forces suppliers to subsidise home insulation and new boilers.
Bills are also inflated by the Feed In Tariffs – a scheme that encourages homes and small businesses to install wind turbines and solar panels by guaranteeing a fixed, high price for electricity they sell to the National Grid.
Dr Peiser said: ‘The Government has to come clean and force the power companies to make their bills fully transparent. ‘Only then will it be possible to see if a power company has been raising its prices unfairly and change supplier. And only then will the true cost of the Government’s mad rush towards renewable energy become clear.’
See in today’s follow up story how Chancellor George Osborne has admitted that the aim is to make power derived from fossil fuels deliberately more expensive.