Power play

Energy supplies across the board are expected to follow Scottish Power’s lead within the next few weeks and increase their gas and electricity prices by up to £200 a year. But Chris Huhne yesterday said that consumers should not accept the increases “lying down” but “hurt” their supplier by finding cheaper alternatives. “Consumers don’t have to take price increases lying down,” he said. “If an energy company hits you with a price increase, you can hit them back where it hurts – by shopping around and voting with your feet.”

Greedy energy producers aren’t the problem. Chris Huhne is the problem. Energy costs in the UK are rising because of the switch to heavily subsidized ‘green’ sources like wind farms. Huhne handed out over £1 billion in subsidies to wind power generators, money he raised by forcing energy producers to buy green power:

The scheme works by requiring energy suppliers to obtain a set percentage of the electricity they provide to consumers from renewable sources. In 2008/9 this figure was 9.1 per cent, compared to 7.9 per cent in 2007/8. For each megawatt hour of renewable energy bought by a supplier from a generator, suppliers must also buy a certificate as proof. If suppliers fail to meet their obligation by presenting enough certificates, they must pay a fine known as a “buy-out”. The cost to energy suppliers is passed on to consumers through their bills.

British voters should understand the reason their power bills are rocketing is Huhne’s policies. Energy suppliers are doing what he told them they must do. No more, no less. Huhne is squirming to demagogue energy companies to deflect attention from his own culpability. He advises consumers to shop around, but they have nowhere to go, Huhne’s rules have forced energy prices up for every generator:

Adam Scorer, of Consumer Focus, told the Daily Mail: “You can incite customers to switch all you want but there is nowhere for them to go. “It is too difficult for operators outside the “big six” to enter the market and only Chris Huhne or the regulator Ofgem can refer them to the Competition Commission, which so far he has failed to do.”

Huhne can’t refer them, because if he did, the truth would come out, and that would be the end of Chris Huhne. Businesses are taking Huhne’s advice and voting with their feet as they ponder which country to move operations to, before rising energy costs make them too uncompetitive to survive: