Brown to cut UK energy bills by £1bn
Thursday, 11 Sep 2008 11:03
Brown announces £1bn gas and electricity bill measures
Gordon Brown today pledged to cut Britons' utility bills by £1 billion with the government's energy efficiency plans.
He told journalists at Downing St that every household would be offered up to 50 per cent off loft and cavity wall insulations, part-funded by energy firms.
"The plans are for six million households to be insulated by 2011," the prime minister said.
Mr Brown added that in the advent of a severe winter then fuel payments to pensioners would double.
"In truth we all know we need a lasting change," the prime minister said of the plans.
"We need permanent changes that can save money. The new announcements are worth £1 billion and aimed at a permanent reduction in bills.
"There are two million households still with pre-payment meters and we are committed to ensuring that those do not face higher tariffs."
Lobby groups are keen for the government to maintain a hard line with energy firms, after Mr Brown ruled out a windfall tax punishing them for heavy profits.
The 'big six' energy companies in the UK have raised prices by as much as 35 per cent in 2008, despite seeing profits rise rapidly in the last five years.
The move to cut bills has been attacked by opossition parties as being "too little and too late".
SNP Energy Spokesman Mike Weir MP said: "After hinting all summer that immediate help was on the way, Gordon Brown has delivered a chilly response.
"The increase in insulation and other fuel efficiency measures are welcome for the longer term, but will do nothing to deal with the immediate problem. Very few households will benefit in time to reduce bills this coming winter."
He added: "This whole package is far too little, far too late and shows that the energy companies have won the battle with the UK government."
The move was welcomed by the Royal Institution of Chartered Surveyors (Rics).
Gillian Charlesworth, Rics director of external affairs, said: "This is a significant step in the right direction. Increasing the support for vulnerable people to install energy efficiency in their homes has got to be the right way to tackle fuel poverty.
"Unlike one-off handouts, the expected energy efficiency measures could cut energy bills by as much as 20 per cent, year after year, and the same time cuts carbon dioxide emissions, essential if the Government is to meet its environmental targets."
Research by Rics shows the savings of some energy efficiency measures:
Improving roof insulation: costs from £300 for a terrace to £500 for a semi. Savings over £50 a year.
Cavity wall insulation: costs from £400 for a terrace to £1200 for a semi. Saves over £150 a year
Double glazing: costs from £4,000 for a terrace to £8,000 for a semi. Saves over £110 a year
Insulating hot water tank: costs £100. Saves around £30 a year
Replacing a boiler: costs between £1700 and £3000. Saving in excess of £150 a year.
New measures announced today:
Proposed new money from the energy companies and generators:
£910 million towards the National Home Energy Saving Programme - £560 million directly into the existing home insulation and energy efficiency programme (CERT) and £350 million for Community Energy Saving Programme.
New money from the Government:
An extra £74 million for home insulation and central heating (Warm Front).
An estimated £16 million for cold winter payments.
In addition £800 million was announced as part of the Budget deal (£575 million in winter fuel payments and an additional £225 million from the energy companies to be spent on their social programmes) bringing the total new spending this winter to £1.8 billion.
Your views
Graham from Manchester: What about people who live in council property and cannot work due to poor health and have to live on income support? I see there is not on jot of help for them. And also people who have pre paid meters have to pay more so no help for them either. It is time Gordon Brown did something for them as well.