Government responds to Labour energy price fix plan

Energy secretary Ed Davey has described Labour leader Ed Miliband’s pledge to freeze energy bills following the next general election as a ‘risk’ to low carbon investment whilst increasing the likelyhood of blackouts as existing generation capacity is not replaced.

Davey appeared to agree with the stance of the major energy suppliers that any attempt to fix prices and prevent bill increases might bring an end to the substantial investment required to replace ageing UK power stations.

The government also pointed to the possibility of sharp hikes in fuel bills immediately prior to any freeze period as energy suppliers attempt to secure profit margins for the duration.

“Everyone wants to help with the cost of rising bills but we need to be sensible,” said Davey.

“Government price fixing jeopardises investment in new power stations, making power cuts a real possibility

“It also puts at risk Britain’s transition to a clean, green, low carbon future.

“The best way to keep everyone’s bills down is to help people to save energy, ensure fair tariffs and encourage competition. That is exactly what the government is doing.”

The government also points to existing methods in place to help consumers reduce energy bills including cold weather and winter fuel payments, the Warm Home Discount, legislation designed to simplify energy tariffs and bills plus the 230,000 homes which will benefit from energy efficiency measures installed under the ECO scheme.