Energy: Prices

Energy and Climate Change written question – answered on 27th March 2014.

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Photo of Stephen O'Brien Stephen O'Brien Conservative, Eddisbury

To ask the Secretary of State for Energy and Climate Change pursuant to his written statement of 11 March 2014, Official Report, columns 14-15WS, on EU Energy Council, what the evidential basis is for his statement that climate policy had had little impact on energy prices across Europe.

Photo of Gregory Barker Gregory Barker The Minister of State, Department of Energy and Climate Change

The written statement made by the Secretary of State for Energy and Climate Change, Mr Davey on 11 March 2014 was based on evidence drawn from the European Commission Staff Working Document “Energy prices and costs in Europe” and the International Energy Agency report, “World Energy Outlook 2013”.

“Energy prices and costs in Europe” indicates that increases in network costs, taxes, and levies have contributed to rises in EU energy prices. However, the report also identifies that for 22 of the 27 member states surveyed, support for renewable electricity generation accounts for less than 10% of the household electricity price. It also finds a relatively small impact of the EU ETS carbon price on electricity retail prices either for industry or households.

The International Energy Agency report, “World Energy Outlook 2013”, concludes that the recent widening of the gap between EU and US energy prices is mainly as a result of the sharp drop in wholesale gas prices in the United States due to soaring shale gas production, an increase in oil indexed gas prices in other regions, and higher spot prices for liquefied natural gas.

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