Consumers Face Hike In Energy Bills

(Reuters) – CONSUMERS COULD SEE THEIR ENERGY BILLS rise by up to a quarter over the next 10 years as Britain faces a requirement to invest £200 billion to secure supplies and meet climate change targets.

Energy regulator Ofgem said today the investment would be needed to pay for new power plants and other infrastructure.

‘Given the massive levels of investment needed, there is a high likelihood of rising consumer bills, especially if oil and gas prices continue their underlying rise since 2003,’ Ofgem said following a review of Britain’s energy supplies.

The regulator said customers could face increases in domestic energy bills of between 14% and 25% by 2020, while wholesale price spikes could lead to temporary increases in bills of up to 60% in the interim period.

Ofgem said Britain faces a number of challenges to its gas and electricity supplies over the next ten to fifteen years including power stations nearing the ends of their lives and an increasing need to import gas via volatile global markets.

‘These are big challenges. Britain faces a tough challenge in maintaining secure supplies whilst at the same time meeting its climate change targets,’ said Ofgem chief executive Alistair Buchanan.

Shadow Energy Secretary Greg Clark said the country faces a combination of price rises and worries that power supplies are going to be interrupted.

‘It’s yet another piece of evidence that we face a real problem here. It’s really a horror show,’ he said.

Britain’s main gas and electricity suppliers are Centrica, EDF, E.ON, RWE, Iberdrola’s Scottish Power, and Scottish & Southern Energy.

Ofgem said it will put forward proposals in the new year on how the industry can meet the challenges following a consultation period.