Green Subsidies – How it impacts your energy bills?

December 11th, 2019

Energy costs have soared over the past few years. And one of the blames goes to Green subsidies. People of UK including some of the top industrialist and energy experts are suggesting that it’s the green subsidies which result in heavy taxes on the common man’s energy bills. Although, these were considered as positive measures to create a low carbon economy, the result have been levy on domestic energy bills.

Following are the various types of taxes:

Mind well that some of the taxes are laid on people to save many others from facing fuel poverty. The taxes which you pay are then utilized to give green subsidies used for home upgrades and other projects executed to support energy conservation. Some of the projects which get benefitted from the green subsidies are:

Feed-in tariffs: These are the payments given to people who produce solar energy which they utilize for their own home and give additional energy to the national grid or other suppliers.

Warm Home Discounts: This is the financial help given by suppliers to customers with low incomes. They essentially use this money to keep their homes warm and well heated in the winter.

Renewable Obligation: This rule has to be followed by all energy suppliers. According to it, a certain portion of the energy they supply has to come from renewable sources. Now, to purchase green electricity they put extra charge from the regular customer. So, it all ends up in an inflated bill.

Energy Company Obligation: The ECO also applies to energy companies. According to it, energy companies need to support people belonging to low income households with the home insulation measures. This can be expensive insulation and the price ultimately falls on the regular customers.

Many more of such schemes are there. The government is trying to create a greener world but what it forgets is that the taxes are levied on people other than the low income guys and those who enjoy feed-in tariffs. As per records the green taxes actually add 8-10% on the bill of an average energy customer. This would be an addition of around or more than £100 per customer. This way, the burden actually falls on the regular consumers of energy. This is irksome for many and some of them have raised concerns regarding it. Due to this, now the UK is planning to cut down green subsidies.

Having said that, people in favour of Green subsidies suggest that these subsidies would give long term benefits. Such measures would actually create lower bills in the long run. According to them, the cost of fossil fuels is rising with every passing day and that would end up in higher prices of wholesale electricity. Also, it reduces carbon footprint and so, will save people from unexpected climatic hazards in the future. Another important part is that the taxes are used in creating warmer homes for low income people which is a very good thing.

Can you escape from paying energy subsidies?

Well, not literally. You can do it only if you are energy independent and produce and use energy that is generated by you.

For more details about companies offering green energy, their tariffs, quotes and comparison with other companies, check our website or call us on 02034757476.


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