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20 Feb, 2013 11:23

UK fuel bills to skyrocket on ‘green’ wave

UK fuel bills to skyrocket on ‘green’ wave

New green regulations and policies in Great Britain could send fuel bills soaring as early as next month, warns the country’s energy regulator Ofgem.

Ofgem chief Alistair Buchanan has warned of higher prices for gas as foreign supplies shrink while demand increases.

Moreover, 10% of coal and oil-fired power plants are due to close next month in order to meet new green regulations coming into force in April. Alistair Buchanan warned large power cuts are 300 times more likely to occur by 2015, as reported by Daily Mail.

A new carbon tax means older power plants must install expensive technology to reduce emissions or shut down by 2015. This will see one in ten plants closing at the end of March and more are likely to follow, according to the regulator.

UK ministers were banking on low-carbon energy from nuclear power and wind farms but it does not yet provide enough power to keep the lights on in Great Britain, the Ofgem head claimed.

We have to face the likelihood that avoiding power shortages will also carry a price,” Mr Buchanan was quoted as saying. “If you can imagine a ride on a rollercoaster at a fairground, then this winter we are at the top of the circuit and we head downhill – fast.

The UK government has been trying to reform the electricity market but addressed the issue too late and price rises seems inevitable, Daily Mail reports.

The news comes as Russia’s Gazprom is due to start pumping gas to the United Kingdom in 2014 under a contract signed with Centrica for the delivery of 2.4 billion cubic meters. 

Gazprom has also held talks with British Petroleum about extending the Nord Stream pipeline which would allow Russian gas to be directly supplied to the UK by 2016.

The Nord Stream pipeline runs from Vyborg in Russia to the Greifswald in Germany under the Baltic Sea. Britain reportedly intends to extend the pipeline to Norfolk, which will require the construction of another 600 miles of pipe, taking about two years and costing about £300mln.