Support for Stop the Energy Swindle campaign by Taxpayers Alliance

Having signed an online e-petition, Stop the Energy Swindle campaign by Taxpayers Alliance, I received a response from my MP in which she stated: However, it is important to note that recent increases in energy bills have mainly been as a result of rising international prices for fossil fuels and not climate change policies. Around 60 per cent of the increase in household energy bills between 2010 and 2012 was as a result of this. So, as I often do, I went to check the facts I have an inherent distrust of politicians and their ilk, especially when they quote percentages. Needless to say, the quoted figure presents government policy in a good light. But what is the reality? Why was the year 2010 chosen? 2012 seems reasonable since data for 2013 will obviously not be available for time. But surely looking over a longer period would make more sense as it would help eliminate the short term swings that are intrinsic in such indices? As it happens, Ofgem has provided an easy to read graphic that allows us to understand why that period was chosen. For conciseness, Ill only present the Dual Fuel chart here which is probably the most representative since the majority of UK households use both gas and electricity.

You will note that the year 2010 had low wholesale energy costs and so using this baseline artificially biases in favour of the rising cost of fossil fuel argument. Had the year 2009 been used instead then there would have been essentially zero change in wholesale energy costs, and it might even be able to squeeze out a fall in costs. Over the five or so years of data presented here, there has been a gradual increase in net margin and that accounts for a proportion of the increase in bills. Whilst it may be a little more difficult to see, VAT, operating & other costs show continuous and significantly larger increases than that of wholesale energy. Thus we can see that the rise is not mainly due to the cost of fossil fuels. Therefore it is clear that the MPs assertion is at best very weak, and at worst flawed and dishonest. For further confirmation, the following table annualises the data, presenting it in figures:

These VAT, operating & other costs are largely policy induced with their origins firmly rooted in the climate change agenda, albeit they are typically classified under the more general label of environmental taxes. The following graph illustrates how environmental taxes have been evolving:

It is also important to remember that during this period the energy consumption trends have been downward, as is shown by the graph above. Thus, had the consumption remained constant, energy bills per household would now be more than 8% higher or at least 110 per year more. How much of this drop in consumption is a result of people being pushed into fuel poverty and others forced into uncomfortable living conditions that could impinge adversely on their health? The one thing that is certain is that the cost will be affecting the poorest and elderly most, and no doubt there is a knock-on effect on services such as the NHS. And remember, the present energy policies are designed to combat global climate change, but there has been no increase in global temperatures for at least 16 years. Energy policies drive energy costs and are entirely a political construct, the basis of which was laid-out decades ago in UN Agenda21.

Conclusion: My MP has tried to mislead, or fob me off and presumably many others with biased statistics. I have little doubt that she had been supplied with these, quite probably by Ed Davey MP, Secretary of State. However, there can be no excuse for such misrepresentation. The data presented above shows that the increase in domestic energy costs did not come principally from the wholesale price of fossil fuels but from government policies and energy company profits. Claiming otherwise is disingenuous.

Jonathan Drake 28/9/2013