A REPORT by the University of Warwick estimates that the average household in Reading could see energy bills rise by £1,000 a year.
The paper details research conducted by economists at the university which modelled the impact of the energy crisis on household bills.
The models used the National Energy Efficiency Data Framework and Energy Performance Certificates in the public domain to assess costs, usage levels, and possible savings.
With Ofgem’s announcement of energy prices in October, the average energy bill would increase by as much as £1,842, the report explains.
However the government’s energy price guarantee scheme has brought this down to a rise of just over £1,000, doubling prices October 2021.
Overall, £58 million of extra bills could hit Reading residents, with all households affected in at least some way.
Even households that consume very little energy, often representing some of the poorest residents, will see bills increase by £587 for those in the lowest 10% of usage.
This group typically represents those with lower wages, with most living on a household income of less than £15,000.
The report warns that his could cause a “drastic decline in real standards of living,” and threatens social stability.
This is especially so in the context of “economic fallout from the pandemic,” from which many are still recovering, more than ten years of stagnant productivity growth, and a real-terms fall in incomes.
It warns also that some will be caught off-guard by price hikes, citing a study published in 2010 which showed that many households were unaware of how much energy they were using.
The report cites the illegal invasion of Ukraine by Russia and the subsequent “dislocation” of energy markets.
This follows what it calls “broad foreign policy expert consensus” that energy is being used as “leverage” to undermine support for Ukraine by Western nations.
The paper explains that reduction in energy usage will be a key method of bringing down household bills, not only as part of the energy crisis but long-term.
It argues that reduction of usage would save households money permanently, reduce carbon footprints and help achieve Net Zero targets for the country.
It also averts higher taxes or further budget cuts, which disproportionally benefit wealthier households, and reduces the reliance on third-parties such as energy suppliers or countries to use energy as leverage.
Among its proposals for helping residents save energy are the use of insulation and condensing boilers, which are the most impactful measures.
It also cites improvements to hot water cylinder insulation and upgrades to boilers, heaters, and window glazing where possible.
It proposes a number of actions which could be taken by the council, such as securing funding for energy investments within the council.
The paper suggests councils refer appropriate residents to large energy suppliers for retrofitting under their ECO scheme, or through government energy efficiency schemes.
To read the full publication of the Thiemo Fetzer, Ludovica Gazze, Menna Bishop’s findings, visit: warwick.ac.uk
