Low-carbon technology 'will not mean big bill rises'

Members said their "best estimate" was that green policies would add £110 to bills per household in 2020.Claims that the costs of wind farms and other low-carbon technology will lead to sharp rises in fuel bills are wrong, government advisers say.

The Committee on Climate Change (CCC) says increases in bills over the past few years have been largely due to higher wholesale gas costs.

It emerged recently that an estimated 1.5m people are in fuel debt in the UK.

The combined gas and electricity bill for typical households could go up from £1,060 in 2010 to £1,250 in 2020, according to analysis by the committee.

But further energy efficiency measures - such as loft and wall cavity insulation - could see the projected 2020 bill fall to £1,085 per household, it said.

CCC chief executive David Kennedy said the committee had analysed the impact of investing in technology including offshore and onshore wind, nuclear and carbon capture and storage.

Mr Kennedy said the cost of this investment was "significantly" outweighed by the benefits - including a reduced reliance on imported fossil fuels.

Looking back, the CCC said an analysis of the average dual fuel energy bills showed an increase of £455 over the six years 2004 to 2010.

However, 80% of this rise was unrelated to low-carbon measures and the biggest contributor was rising gas prices, which added around £290 to bills.

Mr Kennedy said that some people had claimed that energy bills were "through the roof at the moment" because of investment in green energy - but the committee's analysis showed this "clearly" was not the case.

A second claim that investment in low-carbon technology over the next decade would drive bills to "astronomical levels" was also untrue, he said.

CCC chairman Lord Adair Turner said: "Over the next decade, we anticipate a rise of around £100 in the average bill as a result of investment in low-carbon power capacity, which will benefit the UK in the long run."

Fuel poverty

The committee's analysis comes against a background of increased concern about rising fuel costs.

In November it was revealed that the number of people with energy debts had risen by a quarter for electricity and a fifth for gas.

Campaign group Consumer Focus and charity Citizen's Advice say energy prices increased by seven per cent last winter and warn that further rises of 14% this winter could push more people into debt.

An independent report by Professor John Hills published in October found that 2,700 people died each year from problems linked to fuel poverty such as respiratory or cardiovascular disease.

And government figures released over the summer suggested that more than a fifth of all households in the UK in 2009 were affected by fuel poverty - meaning they spend more than 10% of their income keeping warm.

Professor Hills called for a new definition of fuel poverty, which focuses on people with low incomes driven into poverty by high fuel bills.

• Committee on Climate Change