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Electricity Bills: Green Power Plan To Add £100

(c) Sky News 2012

Green power could add £100 a year to electricity bills by 2020 under new government plans.

An estimated £110bn is needed in the next decade to renew the UK's ageing electricity infrastructure and much of that is set to go into low-carbon power sources such as wind farms.

But the coalition's long-awaited green energy strategy is set to treble the costs levied on bills from £2.35bn a year to £7.6bn.

And the increased cost to bill-payers from the drive for clean energy could reach £178 a year by 2030, before adjusting for inflation, experts believe.

However, officials say that while consumers will pay more towards green energy strategies they will also save money through increased energy efficiency at home.

The forthcoming Energy Bill, which aims to drive the investment, has been the subject of political wrangling within the coalition.

There have been mixed messages about how committed the Government is to supporting a greener economy or backing new gas power.

But agreement has now been reached on contentious areas.

Energy (NYSEArca: JJE - news) secretary Ed Davey told Sky News: "By making sure Britain produces our own clean energy we can insulate consumers and insulate the British economy from imported gas prices which is better for energy security."

Significantly, the bill will not include a limit for the amount of carbon dioxide that can be emitted per megawatt hour of power from the electricity sector by 2030.

The Government believes the spending level agreed for low-carbon power subsidies will allow the UK to meet goals to supply 30% of electricity from renewables by 2020.

Environmental campaigners have reacted angrily to the news that carbon emissions will not be capped.

John Sauven, executive director of Greenpeace, said: "By failing to agree to any carbon target for the power sector until after the next election, David Cameron has allowed a militant tendency within his own ranks to derail the Energy Bill.

"It's a blatant assault on the greening of the UK economy that leaves consumers vulnerable to rising gas prices, and sends billions of pounds of clean-tech investment to our economic rivals."

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