New report shows how Big Six energy utilities are spending your money

Posted by Lawrence Carter — 22 April 2012 at 5:53pm - Comments
All rights reserved. Credit: Greenpeace

Across the UK millions of families and businesses are feeling the economic squeeze.

As anybody who has recently received their bill for last winter will be painfully aware, soaring costs of energy are a huge reason for this.

Shocking new analysis by Bloomberg New Energy Finance for Greenpeace, shows that most of the Big Six energy utilities haven’t been investing money from customer bills in a way that brings energy prices under control and secures a clean energy supply for the UK.

The government’s independent advisors, the Committee on Climate Change, and the energy regulator Ofgem have both pointed the finger squarely at the rising cost of gas as being by far the biggest contributor to increased bills over the last eight years.

Ofgem found that of the £150 increase in the average dual fuel bill between March 2011 and March 2012, £100 was due to the rising wholesale cost of energy, largely driven by the increased price of gas.

We’ve already shown how gas prices (as well as pay for the energy company bosses) have rocketed over the last decade.

This worrying trend is set to continue. The chief executive of Ofgem recently argued that gas could be increasingly expensive to import as countries around the world compete for supplies. 

This means higher bills for everyone, unless we can reduce our vulnerability by cutting our dependence on gas.

It also means higher emissions. The government’s climate advisers recently wrote to the energy secretary warning that a new ‘dash for gas’ puts at risk our ability to achieve the carbon emission cuts set out under the Climate Change Act.

But lobbyists for the gas industry want to make us even more reliant on burning gas for power generation.

The new research by Bloomberg has found that since 2006, £13 billion has been spent by the Big Six energy utilities on 14GW of new electricity generating infrastructure, and over half of this has been new gas plant.   

While Scottish Power have added 100% of their new capacity through renewables and SSE more than two-thirds, the worst culprits are Centrica, EDF, E.ON and RWE Npower, which added more than two-thirds of their new power capacity through gas. With separate Bloomberg research showing an additional 11GW of gas expected to come on to the grid in the next five years, we will all become increasingly vulnerable to volatile global gas markets unless the government takes decisive action.

To bring bills under control and ensure that we play a leading role in reducing dangerous climate change emissions, it is crucial that the Big Six energy utilities (which supply almost 90% of UK customers and own 70% of national power generating capacity) invest the money we pay them into reducing our dependence on burning gas. That means putting large scale energy efficiency and renewable energy at the heart of their investment plans.

Our new report reveals that when it comes to investing in alternatives to expensive and polluting gas imports, with the exception of Scottish Power, the Big Six have been massively outperformed by new entrants to the UK’s energy market.

In fact, if you have a solar panel on your roof, you’re part of a group of small-scale solar power owners that together own more renewable capacity than any of the Big Six.

When Bloomberg ranked renewable generators in the UK, E.ON and EDF came 6th and 10th respectively. Worst of all has been British Gas owner, Centrica, which finished 12th with just a 2.3% share of UK capacity. This is despite the fact that the company has more domestic customers than any other utility and has consistently made the highest profit margin. Instead of investing to reduce Britain’s reliance on imported gas, or delivering lower bills for its customers, Centrica are profiteering, handing out huge dividends to shareholders whilst letting consumers pick up the tab.

With a shake-up of the UK energy market taking place this autumn, it is vital that the government stands up for hard-pressed consumers and protecting the climate.

To do so they must ensure that energy companies invest in clean, home-grown energy sources, instead of expensive and polluting gas.

We have done our bit by slashing our homes energy usage & local carbon / air pollution emissions. We achived a 60% reduction by replacing the old gas boiler with a ground source heat pump & installing solar PV on the roof. We have disconnected from the gas grid & thus no longer burn any fossil fuels in our property. We also replaced one of the cars will a 100% electric Nissan Leaf again dramatically lowering air pollution & CO2 emissions. 

Thus its time for the big 6 to step up & start to decarbonise electricty production by investing in renewable forms of generation backed up with lots of grid storage. Thorium based reactors could also be used to reduce the stockpile of nuclear waste reducing storage requirements from 1000s of years to a couple of 100 while generating low carbon electricity. 

We have done our bit by slashing our homes energy usage & local carbon / air pollution emissions. We achived a 60% reduction by replacing the old gas boiler with a ground source heat pump & installing solar PV on the roof. We have disconnected from the gas grid & thus no longer burn any fossil fuels in our property. We also replaced one of the cars will a 100% electric Nissan Leaf again dramatically lowering air pollution & CO2 emissions. 

Thus its time for the big 6 to step up & start to decarbonise electricty production by investing in renewable forms of generation backed up with lots of grid storage. Thorium based reactors could also be used to reduce the stockpile of nuclear waste reducing storage requirements from 1000s of years to a couple of 100 while generating low carbon electricity. 

I'm confused. I've looked to swapping providers and so checked their fuel mix figures on their websites. Scottish Power does well in your article for renewables yet its own figures say it produces 620g CO2/kwh. EDF does badly in your article yet produces 280g/kwh.

Very interesting comment by Jac99, I would be very interested if any one should shed some more knowledge on the situation, I know from experience that company reports and accounts can be difficult to read and mis-leading. Using Jac's examples it would be interesting to know why Scottish Power who do well in the article seem to produce more Co2/kwh.

 

The problem possibly is reading and accepting the article at face value. It says that Scottish Power has a good investment in renewables and their website says 'We’re committed to continuing to be a UK leader in renewable energy solutions' but currently their electricity is 48.9% from coal, 43.7% from gas 7.6% renewables and 0% nuclear ( http://www.scottishpower.co.uk/support-centre/service-and-standards/where-we-get-our-energy.aspx ) .   EDF are 27.9% coal, 5.7% gas, 3.9% renewable and 61.8% nuclear.  http://www.edfenergy.com/products-services/fuel-mix.shtml.

 

   I am beginning to doubt this Austerity Plan in part at least, as it was only last week that I noticed a shop had increased it's Prices by 50% and today we hear of the English Parliament thinking of allowing Companys by law to sack a worker on the spot.

  To me it appears that this Austerity thing is just a furtherance of the Thatcher Era to destroy the Unions, or at the least an aid to this destruction Plan, and ironically Thatcher was keen enough to send the unemployed out to fight in the Faulklands War  under the guise of protecting the Islanders, while the whole Plan was to look for more Oil  which at the end of the Day would make Global Warming even worse.   Then in later Years they went to War to even steal the self same Planet's destructive cause.    They then go on to support the Nuclear Program where we at least know that one of the most interesting features of this is the War Material Plutonium. 

This is useful, I would prefer to use an energy company that has a sustained investment in renewable energies. Especially as my main research is based on this.

http://imechanica.org/blog/22707

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