While the need for green and renewable energy sources is widely accepted many will be unhappy to hear that the cost of these initiatives will be largely paid for by businesses and residential customers. The assumption by many has been that green energy sources would potentially save month on consumer bills however this seems unlikely.
The European Leaders and the UK Prime Minister David Cameron met recently in Brussels to encourage a cut of as much as forty percent in carbon emissions by 2030. With energy regulations handed down by the EU looking set to cost the country approximately 8.4 billion a year it is easy to see why some are concerned.
The Cost to Businesses
While the residential customer could see their bills rising by as much as £150 per year by 2030 it looks likely that businesses will bear the brunt of the EU’s latest decisions.
Already hit by CCL (Climate Change Levy) and numerous other green and assorted energy taxes and restrictions researchers believe that by 2030 businesses could find their energy bills will have risen by a staggering twenty three percent, almost a quarter. The report from think tank Open Europe shows that the expected energy bill rise for businesses, which will cover the cost of a cut in emissions by 40% and fund wind farms and other green initiatives could be crippling to some. This rise could by the time the proposed 40% cuts are achieved cost small and medium sized business as much as £350k per year to energy bills.
Open Europe have already estimated than on average household gas and electricity bills in 2013 rose by 5% as a result of targets and regulations handed down by the EU therefore it is safe to
assume that business energy bills were similarly hit by the cost of green energy.
With the government and the EU keen on imposing these new carbon emission cutting targets and the result of these hitting bill payers it appears that for businesses to stay afloat additional cost-cutting measures must be put in place. Current targets indicated that all households and small business should be on a smart meter by the end of 2020 which will for some cut their annual bills due to costly estimated bills being eliminated.
This, alongside enhanced efforts to cut usage by businesses by employing additional energy efficiency policies and looking to switch and save at renewal time will be what is needed to cut bills and stay on top of the hikes.