The truth about power bill increases

A new factsheet from Net Zero Watch shows claims that high electricity prices are due to the influence of gas prices on wholesale markets are almost entirely false.

Through detailed analysis of Ofgem price cap data and, uniquely, an estimate of the effect of carbon taxes on wholesale markets, it reveals that the gas price is now having only a marginal effect on household electricity bills compared to the situation ten years ago. Around three quarters of the increase in bills since 2015 can be attributed to Net Zero.

The most important factors in the £327 real-terms increase are:

• Renewables subsidies (£83)

• Carbon taxes (£39)

• Grid balancing (£26)

• Capacity Market (£26)

• Grid strengthening (£23).

The direct cost – the element that can reasonably be attributed to the cost of gas – only accounts for £45 of the increase.

Download the factsheet here.