Britons are being warned that net zero costs will push energy bills higher than levels seen during the height of the Ukraine-Russia war, following a stark assessment from the head of British Gas.
Chris O’Shea, who leads Centrica, sounded the alarm that electricity prices will surge by 2030 while speaking earlier this week at the Energy Institute’s International Energy Week conference in London.
He explained: “Our projections show that the UK energy system will be one where by 2030 the electricity price will be higher than it was at the peak of the Russian invasion of Ukraine.”
The Centrica boss explained that wholesale costs would account for just one-third of electricity prices by 2030, with system costs making up the remaining two-thirds.
British Gas boss Chris O’Shea has given a stark warning to consumers
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These system costs stem from the Government’s extensive grid modernisation programme designed to support net zero targets.
Claire Coutinho, the Conservative Shadow Energy Secretary, launched a fierce attack on the Government’s approach, warning that even if gas became free by 2030, household bills would continue climbing due to infrastructure expenses.
She shared: “Energy bosses have warned that gas could cost nothing in 2030 and bills would still rise because of all the costs of building more pylons, paying for back up, and paying wind farms billions to switch off when it’s too windy.
“Britain cannot afford Ed Miliband’s obsession with net zero. Whether it’s for growth or for living standards we need to make electricity cheap by axing the carbon tax and scrapping Ed’s old rip-off wind subsidies to cut everyone’s electricity bills by 20 per cent.”
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Reform UK’s energy spokesman Richard Tice went further, declaring: “The truth has been exposed by the British Gas boss. Our electricity bills could hit Ukraine like highs over the next few years. We have been lied to on a colossal scale and Miliband should resign.”
The system costs driving these price increases include £90billion earmarked for upgrading the UK’s high-voltage transmission network through to 2031, alongside a further £22billion for the lower-voltage distribution infrastructure that delivers power to homes and businesses.
Mr O’Shea emphasised that these investments would be necessary regardless of climate policy, attributing them to prolonged underinvestment in the nation’s electricity infrastructure.
He added: “Those system costs aren’t net zero costs. They are addressing years and years of underinvestment and whether we went for net zero or new fossil fuels, we would need to incur those system costs.”
Richard Tice has called on Ed MIliband to resign
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GETTYThe energy price cap from Ofgem sits at £1,758 annually for a typical dual-fuel household, yet energy debts have ballooned from £1.8billion to nearly £5billion.
Energy leaders at the same conference raised additional concerns about the Government’s ambitions to establish Britain as an artificial intelligence superpower. Fintan Slye, chief executive of the National Energy System Operator, cautioned that data centre demand posed unprecedented challenges to the grid.
“What we’re seeing is the emergence of load on the system at a scale of which just is unprecedented,” he warned, adding that poorly located facilities could push up prices and threaten supply security.
Britain already faces some of the world’s steepest electricity prices, with domestic consumers paying 30p per kilowatt hour compared to 24p in France and 13p in America.