Reports out of the UK reveal that rising prices for natural gas and electricity are causing real incomes to fall in the UK.  The Telegraph (Energy bills cause fall in living standards) and The Spectator (The policies behind your energy bills) covered this story.

The cause of the price increases is directly related to the government’s policy of promoting renewable energy to replace coal and oil.

All in all, switching our dependence away from coal and oil is going to be enormously expensive. Some £200 billion of taxpayers’ money is to be spent on increasing renewable energy output from seven to thirty percent by 2020. And, because sources like offshore wind costs almost £100 an hour more than traditional generators, this policy’s most immediate effect will be to raise energy bills sky high. The repercussions of Britain’s growing dependence on wind power, in particular, will be wide reaching. It will cost £17 billion alone to adapt Britain’s electricity network to wind energy, and new power stations will have to be built along coastlines to accommodate offshore wind, along with another 214 miles of new pylons to carry electricity inland through areas of outstanding natural beauty. (The Spectator)

Now over six million British households spend upwards of 10% of their income on energy. The Telegraph reported that UK families suffered their fourth consecutive monthly squeeze in living standards in October, as soaring gas and electricity prices pushed up household costs. Spending on gas and electricity in October alone grew by 7.4% despite it being one of the mildest Octobers on record.  Higher expenditures are expected as  winter arrives.

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