Why energy prices are rising
Dec 18, 2013
Bishop Hill in Energy: grid

Manic Beancounter has been digging into the official figures for energy prices and costs to see if claims of profiteering by suppliers and generators hold water. In short, they don't.

What is most important is why unit costs have risen. Labour are correct when they say it is not due to the wholesale price of energy. As already demonstrated, they are incorrect to say it is due to rising profits. The real reason is “other costs”. These rose from 32% to 40% of revenue in just four years. That is from £14.1bn to £17.7bn in just four years or a 25% increase. On declining volumes this is more significant for consumers.

Other costs includes things like windfarm grid connections and green levies. Read the whole thing.

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