Three companies - British Gas, ScottishPower and Scottish & Southern – have announced price rises in recent weeks. At the same time, freezing weather and snow across Britain has boosted energy demand.
Jim Dale, senior risk meteorologist at British Weather Services told Bloomberg News
that December may be the coldest in more than 30 years.
“We are expecting a return to Arctic weather including blizzards and deep frosts from around Dec. 17.”
The Arctic weather has pushed up demand for both electricity and gas. Between 35-40% of the UK’s electricity is generated by burning gas, so the prices are linked. Since the price of gas has risen in recent days, it has also become more attractive for generators to switch to coal or oil, causing a rise in carbon emissions. (Carbon emission permits have also gone up in price.) The most expensive form of power generation is oil, so this too will have an impact on electricity prices.
The UK’s natural gas storage facilities are currently about 70% full, compared to 95% this time last year. If temperatures continue below average, we can expect to see prices go even higher, as we'll be forced to import more gas when storage runs low.
If that's not bad enough, today's Independent
reports that energy prices may rise by 25% over 10 years
Posted by Robert Butler at Wednesday, 8 December 2010
, energy bills