Business leaders have warned that green taxes, designed to help the UK meet European Union (EU) climate change targets, are pushing up energy bills which in turn are damaging both businesses and families.
Businesses are warning that it’s more important to cut fuel prices than meet European Union climate change targets and therefore the green levies on energy bills should be cut.
Business groups want the government to prioritise cuts in fuel prices rather than meeting carbon emissions targets. But as Utility Exchange reported this week, the Energy Summit on Monday offered no hope of cheap electricity or gas in the near future and it looks like businesses and families will continue to struggle with high energy bills over the winter.
Chris Huhne, the energy secretary, said this week that UK energy prices are “relatively good” compared with other countries. However, the director general of the Institute of Directors, Simon Walker, said the emphasis towards green energy was pushing up energy bills. He said “Current policies risk locking us into cleaner and more expensive energy, when the goal should be cleaner and cheaper energy”.
He warned that the UK’s competitiveness is being undermined by high energy costs. He said this would “..do no favours to either economic recovery or environment”.
Increased energy costs have been blamed for the increase in inflation this week. Consumer Price Index (CPI) inflation increased from 4.5% to 5.2% in September. The data was released by the Office for National Statistics which said in a statement “By far the largest upward pressure to the change in CPI…came from increases in gas and electricity charges”.
However, experts think inflation has now peaked and that next year it will begin to fall.
Much of the emphasis over the last few weeks regarding energy prices has been on domestic energy but business electricity prices and business gas prices have also gone up this year. This has an impact on everyone because energy prices affect the cost of goods and if business owners can’t afford rising energy bills and fuel costs then jobs may be lost. The cost of business energy affects so many things. If the cost of goods increases and jobs are lost then it means people have less money to spend on their own energy, food and transport.
It’s for this reason that business leaders are urging the Government to act to cut energy bills and warn that the extra taxes on bills to meet EU climate change targets are damaging businesses. But it needs to be remembered that if energy prices are damaging businesses then they will also have an effect on workers and in turn on how much they can spend on energy at home.