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A future of power shortages and higher gas and electricity
bills in the years ahead is likely unless something is done says Ofgem.
This makes YOUR quest for the best gas and electricity prices and the task of doing a compare gas and electricity prices check even more urgent.
Energy regulator Ofgem estimates that 40% of people who switch do not get a better deal.
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The main offenders for poor or no savings are home sales callers who are paid on a commission basis.
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According to Ofgem the UK energy industry’s watchdog, “More and more people will not be able to afford enough electricity and gas to heat their homes”. It expects household bills for gas and electricity to soar.
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Speaking on BBC News, Ofgem chief executive Alistair Buchanan said: ‘Given the scale of investment, our energy bills are going to have to take some of the heat on that.’ He also warned that the global financial crisis, environmental targets and the closure of ageing power stations “cast reasonable doubt” on whether there will be enough energy for the UK by 2015.
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The country is facing energy problems within just a few years, according to Ofgem. Five of the UK's fourteen coal power stations must be retired by twenty fifteen and seven of the ten nuclear power stations will have to close by the end of the decade.The first new nuclear power stations will not be built until twenty seventeen. It is unlikely that Britain will be able to build the number of wind farms it needs quickly enough to meet the shortfall. It seems that the days of cheap energy are over, unless you know where to go!
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They could save you a lot of money.
The problem is this.
Britain needs hundreds of billions of pounds of investment in new nuclear, gas, wind and clean coal power stations over the next decade. But the investment market conditions are not right to encourage this investment. Due to the state of the worlds economy returns are too uncertain. There are great questions as to the ability of the energy industry to be able to deliver such a huge amount of extra capacity in time to avoid disruption.Some of the new technology needed is still a long way off.
Ofgem says, “ Radical reforms are needed to safeguard power supplies”.The chief executive Alistair Buchanan said, “that without reform there could be a “degree of crisis” in 2013 or 2014, and a failure to act would mean customers would end up footing the bill for costly short-term solutions."
"In 2017 we get to the really sweaty-palm moment in terms of possible shortages."
"It is the scale of collapse in energy supply from 2013 up until 2017 that is profound and worrying. Companies say that there are X-gigawatts of new power stations in the pipeline, but you can't rely on this."
According to Mr Buchanan many companies believe the predictions are actually too optimistic.
The CBI business group, said it was a "stark warning that existing policy will not deliver the balanced energy mix".The UK Government stance is that it would meet all its power needs in the next 10 years. But admits, “it needs to turn over all the stones with regard to the possible solutions that Government can address.” The Governments’ special energy adviser, acknowledges that there will have to be more intervention in the industry if the country is to avoid power shortages.
The alternative, refusing to admit that change is needed, will inevitably lead to "blackout Britain", according to Ian Parrett, from energy experts Inenco, with industry and homes facing regular power cuts as early as 2012.
Ofgem's 110-page report on the state of gas and electricity markets in the UK boils down to two simple prescriptions: It needs more money and more government regulation.
Ofgem's ideas – the establishment of a government-owned or regulated ‘energy buyer.’ a lower limit on the carbon price, payments for providing extra capacity and forced obligations to build more power plants.
The consumer magazine ‘Which’, said: ‘Ofgem’s report has identified a range of measures to ensure we have safe, secure and affordable energy in the future but it also raises the question of who is responsible for deciding which measures to implement and how to implement them.’Undoubtedly over the next few years the energy market is going to change and it will be difficult to keep up with all the changes. It will be harder to get the cheapest gas and electricty deal unless you know where to look.
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