Expect energy price hikes for 17 YEARS to fund UK infrastructure

Household gas and electricity bills are set to increase in cost above the rate of inflation for an eye-watering 17 years, the government’s National Audit Office has warned.

The NAO believes bills will hit an average of £2,135 a year – and up to £2,833 when water is added in.

And at least two-thirds of the £310bn of planned infrastructure investment in the UK over the next decade will be funded by private companies that are ultimately getting the money from consumers via the money they pay for utilities.

The NAO said it was concerned that low-income households were being forced to spend 15% of their incomes on energy and water in 2011, while their income had fallen by a gutting 11% in real terms since 2002.

Five million UK households are currently in fuel poverty.

The average UK household (across all income brackets) spent 8% on energy and water in 2011.

The head of the NAO, Amyas Morse, said: “Government and regulators do not know the overall impact of planned infrastructure on future consumer utility bills, or whether households, especially those on low incomes, will be able to afford to pay them.”

Margaret Hodge, the chairman of the Commons Public Accounts Committee, said: “I have serious concerns that government is taking decisions on infrastructure, banking on hard-pressed consumers to foot the bill, without knowing whether households will be able to afford to pay.”