Fuel Prices continue to rise (Paul Harrod)

Fuel Prices continue to rise

March 3, 2009 11:28 PM

Last year gas and electricity prices rose by as much as 40%. The energy companies blamed the rising "wholesale" price of fuel for the misery of expensive heating bills.

Now they have cut prices by only 10%, even though the "wholesale" price they pay has dropped much, much more.

It is clear that the Labour Government does not have the courage to tackle these high price rises which left many residents this winter having to decide whether to heat their homes or pay their bills.

When Lib Dem shadow Chancellor Vince Cable was in Bristol last month he made the point that it would have been much more effective for the Government to have invested money in insulating people's homes, creating jobs and saving energy bills, rather than a pointless cut in VAT which no one has really noticed.

Thousands of people in Bristol still pay over the odds for their electricity through pre-payment metres. Despite Government promises we still have the scandal that those on the lowest incomes pay more, per unit, than anyone else. Nor has there been any great progress in the roll-out of 'smart metres' that have been long promised. These devices make it much easier for families to see what energy they're using and work out how best to use less.

Finally there is the ridiculous situation that almost every company charges a high price for the first few units of energy you use - and then less for the rest. That's totally unfair on people trying to economise or help the environment by using less. The system should be reversed, so our basic energy needs are the cheapest.

As we move into the Spring these issues may seem less pressing! But serious reform of the way our energy markets are regulated and operated is needed, as we can't afford another winter like the one we have just had.