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UK households to pay more for continued use of gas as government 'rebalances' subsidies

Published 30/03/2023, 09:00
© Reuters.  UK households to pay more for continued use of gas as government 'rebalances' subsidies
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Proactive Investors - Households will face higher energy bills if they refuse to switch from gas under new measures from the government to hit its net-zero targets.

According to ministers, the plan involves changing the balance of subsidies to make gas less attractive than electricity for the main household uses of heating and cooking.

Using gas could cost as much as £100 a year more under the new plan, according to reports today, while electricity costs will fall.

Grant Shapps, energy security secretary, said: “If we want people to switch to an electricity-based economy, it would be better if [levies] were shifted onto the gas side of things.

“It automatically makes the economics of an electric-driven economy better.”

Customers pay green levies in their bills, which were designed to help the renewable industry get established.

Currently, these amount to £131 on typical annual electricity bills but gas levies are only £34 and in the Skidmore report in January, a change to 'the balance' was recommended.

Confirmation of the change is expected in the government's raft of new energy measures as part of its 'Green Day', which is likely to include a renewed push to get households to switch away from gas-fired boilers.

A decoupling of gas and electricity prices is also expected, which should also reduce electricity prices after complaints nuclear and renewable generators made excessive profits during the recent energy crisis by linking their prices to the soaring cost of gas.

Read more on Proactive Investors UK

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