By Frances Allan
Energy prices could increase by up to 60% over the next 15 years a report published today has estimated.
Ofgem, the government’s energy regulator, forecast that energy bills could rise between 14% and 25% by 2020, but if the wholesale price continues to climb, consumer’s energy bills could increase by up to 60%.
The current average bill for gas is £804, which could rise to over £1,000 a year.
If the prices increases by 60%, this would but gas bills at an average of £1,206.
Electricity is currently around £443, and could grow to £553.
Ofgem chief executive Alistair Buchanan said: “Britain faces a tough challenge in maintaining secure supplies whilst at the same time meeting its climate change targets.”
He continued: “These are big challenges. Consumers are already enduring high energy prices.”
The regulator also said that there would be a reduction in carbon emissions of between 14% and 23%.
The North Sea is a producer of gas and oil, which has been declining in production by 2% each year since 2000.
Whilst Scotland is an exporter of fuel from the North Sea, the UK continues to import fuel from around the world.
In the last quarter of 2009, exportation of fuel from Scotland was down by 6%, but it is worth £2.2 billion to the economy.
The National Grid estimates that by 2010, the UK will be importing up to 46% of the gas it needs for both domestic and industrial use. By 2013, the UK will be importing 67% of its fuel. As Gas is such a unique fuel and is easy to use and control, it is widely used in UK industries.
