Europe UK (Commonwealth Union) – The energy crisis that emerged last year had many across the UK concerned about energy bills amidst rising inflation and they would have to make a choice between heating or eating.
A new report has revealed that energy consumers in the UK had seen huge increases in energy costs, while electricity generators saw their income rise last year.
A report, titled “Where does the money go? is an assessment of incomes in the GB power sector as the energy crisis”, was underway. Researchers discovered that electricity consumption across the UK had resulted in £29 billion more in 2022 when contrasted with pre-Covid levels. This was an elevation of around £500 for an individual. The report utilized public datasets along with evaluations of the structure of revenues produced by various sources of electricity production across the UK.
From the £29 billion rise in revenue, roughly 70 percent went to natural gas, as well as renewable energy producers with ‘renewable obligation credits. The remainder had gone to nuclear, biomass together with coal generation.
“The exploding costs to consumers over the last year highlight the need to disentangle the UK’s electricity market from the volatile prices of fossil fuels, and to better embrace the cost predictability and stability that renewable energy can provide,” explained the Lead author Professor Michael Grubb of the University College London, Institute for Sustainable Resources.
The rise in profits for the generators of power led the Government to bring in the Electricity Generator Levy that commenced on the 1st of January this year, also known as a “windfall tax”. If the levy had been implemented in 2022, it would have lowered revenues to renewable generators by around 12 percent to 15 percent, though that likely may not have reduced costs for consumers unless that collected revenue was utilized as a direct subsidy for consumers.
The new report adds to prior research released last year analyzing the way natural gas prices brought about the price for electricity in the UK, despite more economical renewables producing most of the power in the UK.