The heat is on

As two energy suppliers hike prices again, the temperature is rising for households and firms, writes Nathalie Thomas

WHEN, in the grip of the 1970s oil crisis, US President Jimmy Carter advised Americans to turn down their heating, wear more jumpers and switch off their Christmas lights, he was mocked by his critics as a "feckless thermostat-watcher in a cardigan".

But 30 years later, on this side of the pond, households are starting to sit up and listen to his tips after two more energy companies last week unveiled their second price rises in a year.

To the chagrin of consumers already squeezed by spiralling food and petrol prices, Scottish and Southern Energy (SSE) and E.ON told customers on Thursday they will have to shoulder increases of as much as 29%.

For SSE customers, the announcement followed a near 16% hike in gas bills in March, while E.ON had already raised its gas and electricity prices by 15% and 9.7% in February.

SSE and E.ON are not alone. Scottish Gas customers were left holding their heads in their hands last month when it announced a 35% increase in retail gas prices, just six months after raising gas bills by 15%. The French energy giant EDF, which has five million UK customers, also unveiled a second round of double-digit rises in July.

Consumer groups such as Energywatch warned that this second round of increases will push the number of UK households living in fuel poverty above five million for the first time in decades.

"The brakes have failed on the energy market," said Adam Scorer, campaigns director at Energywatch. "The results are calamitous."

Business groups, including the Federation of Small Businesses (FSB), cautioned that the rises will also have a detrimental effect on the economy, in particular Scotland's army of small firms.

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Ten tips to beat energy price hikes

LONDON (Reuters) - The average cost of household gas prices is predicted to rise by up to 40 percent this year. Following is a list of tips from consumer organisations on how to fight back.
1. Check out tariffs
2. Are you entitled to benefits?
3. Could you sign up for social tariffs?
4. Get free advice
5. Get a grant to improve the energy efficiency of your home
6. Get energy-efficient light bulbs
8. Curtain call
9. Turn off your computer and other electrical appliances.
10. Insulate your loft

You can also get a list of the supply companies operating in your area, together with the prices they charge, from Energywatch, the gas and electricity watchdog, by calling 0845 906 0708.

If you are over 60 and not receiving the payment, call the government's Winter Fuel Payment helpline on 08459 151 515.

Ron Cambell of National Energy Action advises all customers to freephone 0800 512 012 to speak to their local Energy Efficiency Advice centre.

Grants cover loft and cavity wall insulation, draft prevention, repairs of faulty boilers and assessment of your home's energy status. To check your eligibility, freephone 0800 316 6011.

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British families pay almost £800 per year in 'dishonest' green taxes

Every family in Britain is paying nearly £800 a year in a 'dishonest' green tax grab, a shocking report said last night.

Hard-pressed households are forking out the staggering sum on flights, fuel and for their cars even though it is 'unnecessary', said low tax campaigners.

Figures published by the TaxPayers' Alliance (TPA) suggest hard-working Britons pay £19.6billion a year too much in tax aimed at covering its carbon footprint.

The levies included fuel duty, vehicle excise duty, landfill tax, climate change levy and the renewables obligation, which is the cost to the taxpayer of power companies generating electricity from environmentally-friendly energy sources.

Subtracting the £8.8billion spent by the Department of Transport on roads last year gives a total burden of green taxes and charges of £24.2billion.
By Ian Drury


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Even "green" energy needs lower oil price

As a lengthening economic slowdown bites, the antidote for the renewable energy sector may come as a surprise -- a lower oil price.

Government subsidies and record prices for competing fossil fuels have underpinned the alternative energy boom, but now they are now starting to work against the sector.

Reliance on subsidies exposes the likes of wind and solar power to the whim of governments grappling with wider voter priorities during a global economic slowdown.

As oil and energy bills have soared consumers have become less tolerant of the extra costs passed on to them by utilities for the greener option.

"Government priorities in the last five years or so have been very clearly environment, security of supply, and way down the list has been price... all of a sudden affordability has shot to the top," said Citigroup utilities analyst Peter Atherton.

"If oil drops back to $80 then government can probably live with it (the extra cost of climate policies)."

Higher oil prices have made onshore wind competitive with natural gas, making continuing subsidies there less important, but more expensive renewable energy sectors and especially solar will be hurt by a policy pull-back.

Europe, the United States, China and India want to ramp up power production from low-carbon wind, solar and biomass to battle climate change and source more secure, domestic energy.

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Giant Retailers Look to Sun for Energy Savings

In recent months, chains including Wal-Mart Stores, Kohl’s, Safeway and Whole Foods Market have installed solar panels on roofs of their stores to generate electricity on a large scale. One reason they are racing is to beat a Dec. 31 deadline to gain tax advantages for these projects.

So far, most chains have outfitted fewer than 10 percent of their stores. Over the long run, assuming Congress renews a favorable tax provision and more states offer incentives, the chains promise a solar construction program that would ultimately put panels atop almost every big store in the country.

The trend, while not entirely new, is accelerating as the chains seize a chance to bolster their environmental credentials by cutting back on their use of electricity from coal.

“It’s very clear that green energy is now front and center in the minds of the business sector,” said Daniel M. Kammen, an energy expert at the University of California, Berkeley. “Not only will you see panels on the roofs of your local stores, but I suspect very soon retailers will have stickers in their windows saying, ‘This is a green energy store.’ ”

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Go green to beat the energy crunch

THE sun has disappeared behind heavy clouds, summer is nearly over and, to make it all worse, some 16million Britons are facing a £250 increase in their energy bills this winter.

British Gas’s plans to raise its fuel bills by 35% – increasing its price rise by 45% already this year – will turn the average household’s dual-fuel bill into a hefty £1,322 price tag. Coupled with the credit crunch, an energy crisis just seems plain unfair.

But by taking a few simple steps in your own home, you could actually cut your yearly bills by nearly £300.

So for those families who have been wondering whether they’ll have only enough money to heat the house or feed the children come December, help is at hand – and it promises to not only be cost-effective, but eco-friendly, too.

The UK Government will fund families aiming to go green by providing up to £2,700 to households on certain benefits. For full details on how to apply for a grant, see www.energysavingtrust.org.uk/ what–can–i–do–today/ energy–saving–grants–and– offers


GET THE BASICS RIGHT

Patrick McCool, who runs his own energy-assessment company, Make My Home Green (www.makemyhome green.com), says draughty British houses are incredibly heat-inefficient.

But before recommending throwing money into expensive double-glazing and thick carpets, he says that little steps across the house can add up to a very eco-friendly whole. It’s all about getting the balance right.

“There’s a lot to do in the house before you worry about things like renewable energy – solar panels and wind turbines and the like,” McCool says.

“Nearly half of our emissions in the UK come from buildings, with 27% of that from domestic buildings, so we need to start looking at our properties differently in how we heat and cool them.

“Most houses in the UK perform really badly in terms of energy efficiency, and it’s relatively simple to make them work a lot better – you just need to know what to do.”

GIVE YOUR HOUSE A HAT

We have all heard that we lose most of our body warmth through the top of our head – but the same can be said for our homes.

About 15% of a house’s heat is lost through the roof – but by insulating your loft with 270mm of insulation materials, you could save £150 on your heating bills, according to Government agency The Energy Saving Trust.

Depending on how much you want to spend, insulation can range from cost-friendly Rockwool (made from glass fibres) to sheep’s wool, to hemp, to Warmcel (made of recycled newspapers – see www.naturalinsulations.co.uk), to Eco-wool (made from recycled plastic bottles and stocked at B&Q – see www.diy.com or www.eco-wool.co.uk).

Once you have done the loft, the next step is to take a look at your walls as homes lose nearly 50% of their heat through both the loft and walls when uninsulated.

The EST says that about 33% of that heat loss is due to warm air escaping through the walls, so insulating them will save you about £120 a year and keep you warm come autumn.

TURN THE THERMOSTAT DOWN

We have all heard that turning the thermostat down just one degree can slash 10% off our energy bills – so why aren’t more of us actually doing it?

“The average house is heated to three degrees warmer than it used to be 20 years ago,” says Edwin Lloyd, who started My Greener Home (www.mygreenerhome.co.uk), a site dedicated to lowering energy bills, in response to his escalating fuel costs a few years ago.

“We are used to going around in T-shirts and shorts in the house when really we should get used to long-sleeved shirts and jumpers.”

Lloyd recommends energy meters such as the Wattson (www.diykyoto.com, or www.mygreenerhome.co.uk/ wattson-energy-meter-54.html) to help families understand where exactly their energy is being used in the house.

“You put a transmitter into your electricity supply near your fuse box which connects wirelessly to a digital display that you can carry around room to room to see what energy is being used where,” he says.

“People don’t realise where their money is going until they see the energy meter jump up once they turn on the kettle or the hi-fi. It makes them think about what they’re doing more.”

CHANGE YOUR LIGHT BULBS

The EST reckons that lighting your house accounts for about 15% of your electricity bill. By switching to energy-saving light bulbs, you could save nearly 80% on your bills per bulb.

“There are good-quality bulbs for every type of fitting now, including the halogen spotlights that are so popular now,” says McCool.

“People frequently have sets of five or 10 in their bedroom or kitchen, which is equivalent to putting on a 500-watt security light every time they walk over to their bed. It’s not necessary, and when they’re dimmer, the room has a much nicer atmosphere.”

DRAFT-PROOF THOSE WINDOWS

Vamping up your rickety sash windows with double-glazed ones could save you about £110 a year – depending on how you vamp them up, that is.

“It can cost about £1,000 to double-glaze a window, which is quite a lot, but I got a company called Quattro Seal (www.quattroseal.com) to do mine,” says McCool.

“I had these old sash windows that they sealed with silicon gel, which has made a huge difference in terms of the draftiness in my front room and only cost about £80 per window.

“If that’s too much money for you, try investing in some heavy floor-to-ceiling curtains – you’ll be surprised at how much that helps, too.”

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Eco-town plans in doubt as short list delayed

A list of 16 bids to build the towns, which was drawn up in April, had already been cut to 13 after three applicants - from areas in Lincolnshire, Staffordshire and Bedfordshire - pulled out.
Now it has emerged that three more, in Norfolk, North Yorkshire and Cambridgeshire, are also suffering problems, while plans for another in South Yorkshire have been cut back from 15,000 homes to 5,000.

Developers in Selby, in North Yorkshire - have had their proposals blocked by local authorities, while a partner in the scheme at Hanley Grange, near Cambridge, has withdrawn. The Government has won permission to build a prison on the proposed site of the eco-town in Coltishall, Norfolk.

Earlier this month Caroline Flint, the Housing Minister, has disclosed in a little-noticed document that the final shortlist of locations for the towns, which was due to be published in October, will now not be released until next year.

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Energy bills are soaring

Energy bills are soaring, so now consumers are looking for ways to save money with their household bills. This is not surprising either, what with British Gas prices recently rising by 35%, and Electricity prices rising by 9%!

Fixed price energy tariffs are one way that consumers can save money on their bills. With these tariffs (or capped energy tariffs) guarantee the price per unit that you are charged will not raise above the agreed amount for a stated amount of time.

This period is usually 1 to 2 years. In the present climate of high energy prices , these deals are becoming more and more appealing.

Really there are two main points to consider when trying to compare fixed price energy deals.

1. Be certain you understand exactly the date that your deal ends, as you will need to be ready for the possibly hike in prices when it runs out!

2. Some suppliers of fixed price energy deals may reduce your capped Unit price if there is a drop in their standard prices, whereas other providers may not do this. -Make sure you know which is the case with your energy provider!

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Generate your own power

Although the initial outlay for most of these technologies is quite high, the Government is offering grants, which can pay for up to 50 per cent of the cost. To qualify, your home has to meet certain energy efficiency standards – such as having full loft and cavity-wall insulation as well as temperature controls. But if you pass these tests, you could receive as much as £2,500 for your project. For more information, and to apply for a grant, visit www.lowcarbonbuildings.org.uk.

Below, we look at the five main options for generating your own power.

Wind turbines

Although Tory leader David Cameron may have a wind turbine attached to the roof of his home in Notting Hill, don't be fooled into thinking that micro-wind power will be suitable for your home. For wind power to be a viable option, you need to live in an area that has an average wind speed of at least 6 metres per second (m/s), below which you won't generate nearly enough power to justify the not inconsiderable cost of installing a turbine.

Solar

A more popular option is to install solar panels on the roof of your home, from which you can replace some of your electricity, or heat your water. According to the Energy Savings Trust, the average domestic system will set you back between £5,000 and £7,500 – and could save you around £230 on your annual electricity bill. Alternatively, if you choose to use solar panels only to help heat your water, your initial outlay would be slightly smaller – between £3,000 and £5,000 – but savings would also only typically be between £50 and £80 a year.
Biomass heaters

Biomass is biological material that can be used for fuel production, such as wood and energy crops. A biomass heater works by burning biomass to heat your home and your water, and, according to the Energy Savings Trust, could save you as much as £550 a year on heating bills. Stand-alone heaters generally cost between £2,000 and £4,000 to install, but they must comply with a number of building regulations, so it's important to check with your local authority that you have the right to build one.
Ground-source heat pumps

The earth a few metres below the ground stays at a constant temperature of 12-degrees centigrade, and by running a system of pipes underneath your garden, it is possible to harness some of this heat. The pipes, which are filled with a mixture of water and antifreeze, are arranged to run in a series of underground loops, heating their contents, which can then be used to heat your home.

The cost of installing one of these systems is between £6,000 and £12,000, but they could help to generate savings of as much as £900 a year.

Hydroelectricity

Finally, if you've got running water on your land, you could consider using its power to generate electricity. Although start-up costs are high – between £5,000 and £25,000 – efficiency levels are very good.

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Generate your own energy

'Our meter is going backwards'

Anne and Peter Watts installed solar panels and an air source heat pump this summer. "It had better work," says Peter, a retired businessman. "I disconnected my oil tank last week, so if it doesn't we're going to freeze this winter."
The Watts say their decision to invest £10,500 on the panels from Jack Elam and £7,700 on the pump from Ardenham Energy was motivated by concern for the environment and about soaring fuel bills.

"Our oil bills were £95 a month - and rising - and I was beginning to worry about how we were going to cope in the future," says Peter.

"I've worked out that even if fuel prices stay the same, the heat pump will have paid for itself in five years and the panels in under 10. It's too early to see how much money we're making from them but on a sunny day our electricity meter goes backwards. It's a wonderful sight."

It is also a rare one in Britain, which generates less renewable energy than most other European countries - a mere 1.3 per cent. Only around 98,000 homes in the UK have some kind of renewable energy source. The Government is consulting on how it is going to meet its EU obligation to raise its renewable figure to 15 per cent by 2020. However, at present there are no plans to top up the £10million pot of grants for homeowners (more than £8.6million has been spent already, so you had better act quickly, especially as British Gas is to raise prices by 35 per cent).

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There's a cool £3bn on offer to insulate you from fuel costs

Thousands of householders who have seen their fuel bills rise could be missing out on money to help them improve the energy efficiency of their homes.

A government initiative, the 'Carbon Emission Reduction Target' (Cert), a home-insulation programme funded by energy companies, was launched in April. Under it, the companies must offer grants to enable householders to make their homes more energy efficient in order to hit carbon emission reduction targets.

Cert spending is expected to reach £3bn over the next three years. Forty per cent of the money has been ring-fenced for the over-seventies and vulnerable households in receipt of qualifying income benefits, but the bulk is aimed at all other householders, and very few have taken it up.

In London, for example, British Gas runs a DIY insulation offer on behalf of the office of Boris Johnson, the Mayor of London. It runs until the end of the year and provides DIY loft insulation for £99. There is £50 cashback available once the insulation has been delivered and payment received.

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Energy suppliers face anger over price rises

Energy companies are set to impose another round of punishing price increases on consumers, despite a steep slide in the wholesale price of gas.

Scottish Power is among those expected to announce double-digit price rises for its 5.2 million gas and electricity customers in the coming days.

E.ON, npower and Scottish & Southern Energy (SSE) are also thought to be preparing further rises to household bills.

The increases will be particularly galling for British families already battling with rising mortgage, food and fuel costs, because they follow a sharp fall in wholesale gas prices.
The price of gas for delivery the following day has dropped 32 per cent over the past month, from 69p per therm in early July to close at 47p last night.

Forward gas prices have also fallen. The price of gas for delivery this winter has declined from 104p per therm last month to about 88p per therm.

The decrease has accompanied a near-20per cent drop in the price of crude oil, to which most commercial gas contracts are linked. That touched a high of $147 per barrel on July 11 and is now at about $118.

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Can you still get a `green' fuel deal?

THE GREENEST DEALS

Some tariffs include electricity from 100 per cent renewable sources, and some offset the carbon dioxide emissions from the gas you use.

Confusingly though, when you buy a 100 per cent renewable package, it doesn't guarantee that the company will produce any additional renewable energy. It could simply mean that someone else, on a standard tariff, gets a bit less renewable energy.

Companies that confirm they do not divert renewable energy from other tariffs include Good Energy and Utilita.

Ecotricity's energy is not all renewable, but, for every £1 spent by customers, the company has invested at least £1 in building new wind turbines.

These `darker green' products are among the most expensive, so there is a trade-off between how much you want to spend on fuel and how green you want to be.

GOVERNMENT ACTION

In March 2007, providers only sourced around five per cent of electricity from renewables. The government wants this figure to increase to 20 per cent by 2020. Energy regulator Ofgem is devising a voluntary scheme showing the fuel mix and carbon footprint of fuel tariffs. It hopes to launch it later this year.

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Poorest targeted with energy-saving schemes

Ministers are examining a raft of green energy measures, including bringing forward a £2.75bn home insulation programme funded by energy companies, to protect Britain's poorest from the impact of rising gas and electricity prices.

They are looking at the idea of front-loading a scheme known as the carbon emissions reduction target (Cert) so that more money is spent sooner by energy companies, with a greater proportion of the funding going to the fuel-poor.

The three-year programme promotes reductions in carbon emissions for households by installing energy efficiency measures such as cavity wall and loft insulation in the homes of people on low incomes and the elderly. It is designed to raise more than £2bn from the energy companies over three years, but could be front-loaded so that more is spent this year and next.
Ministers may also publish a general consultation paper on windfall taxes on the profits of the energy utility companies, but that is not the preferred option of the chancellor, Alistair Darling, or of the Department of Business and Enterprise and Regulatory Reform (Berr) led by John Hutton.

Last week Centrica, the parent company of British Gas announced a 35% price increase, sending shudders through Whitehall. The average British household now faces annual gas and electricity bills of more than £1,200, driving tens of thousands into fuel poverty.

Ministers are also looking at restoring cuts in the Warm Front programme, a package of measures worth up to £2,700 for vulnerable homeowners or for those on benefits. Funding for the programme, designed to cover insulation and central heating, has been cut by 16% from £350m in 2007-8 to £295m in 2008-9, a cut already criticised by the Berr select committee and one that Gordon Brown has already hinted he may reverse.

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Energy giants are told to pay back billions

ENERGY companies are overcharging customers by as much as £1 billion a year in defiance of European Union rules, it was claimed last week.

Lawyers said the breach could lead to consumers taking their utility firms to court to reclaim hundreds of pounds, in an echo of last year’s revolt over bank charges.

The 10m customers who pay by cash or cheque every quarter are being charged £699m more than is justifiable, according to a report from a committee of MPs last week. Pre-payment meter customers, including those with second homes, are paying up to £400m more.

The excess is in breach of an EU directive which states that any difference between payment methods should reflect the cost to the supplier. This is only £20 even though suppliers charge up to £69 more, MPs say.

Graham Kerr of watchdog Energywatch said: “I expect consumers to demand lower payments or even ask for a refund in the same way as bank-charge customers.”

The MPs on the Business and Enterprise committee called for suppliers to be forced to lower tariffs through price controls if they fail to act in 12 months.

This follows British Gas’s decision to raise gas bills by an average of 35% and electricity tariffs by 9%, increasing the average bill by about £267 a year — the highest ever single increase. About 1.6m of the firm’s customers who pay by direct debit have seen a steeper increase of 42%. Customers in London, the Midlands and East Anglia have suffered a rise of almost 44%.

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Giant kites to tap power of the high wind

Ken Caldeira, a climate scientist at Stanford University's Carnegie Institution, has estimated that the total energy contained in wind is 100 times the amount needed by everyone on the planet. But most of this energy is at high altitude.

The blades of modern commercial windmills sit around 80 metres from the ground, where the wind speed is almost five metres per second. At 800 metres, however, wind speed rises to seven metres per second, potentially generating considerably more energy.

It would be virtually impossible to build a standard turbine to take advantage of the wind at 800 metres, but kites could easily get to these heights. Furthermore, thanks to the high-speed jet stream, countries such as the UK, the Netherlands, Ireland and Denmark are particularly suited to flying kites.

'Pretty much anywhere in the UK you could run a kite plant economically, but you couldn't run a wind turbine economically,' said Allister Furey of the University of Sussex, who develops computer control mechanisms to maximise the power generated from kites.

A kite generates power by pulling on a string attached to generators on the ground. When it has reached its maximum height, it is reeled back down to repeat the process.

Using computer models, Furey has worked out that flying kites in a figure of eight pattern means the air flowing over them travels even faster than the ambient wind speed. When a kite needs to be reeled in, it is angled so that it falls out of the sky like a glider, without the need for much power. Ockels's system uses these flying patterns to maximise the power the kites can generate. He is also looking at extending his basic prototype to use multiple kites that yo-yo: when one goes up, another goes down. Ockels estimates that kites could generate power at less than 4p per kilowatt-hour, which is comparable to coal power and less than half the cost of electricity from wind turbines.

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