Energy bills to rise £30/year by 2020 to ward off winter blackouts, MPs warn

In a report, titled 'Electric Shock: Will the Christmas Lights Go Out Next Winter?', the cross-party British Infrastructure Group (BIG) warned of an imminent power crisis, caused by Government targets for closing coal power stations and expanding renewable sources to hit climate change goals.

The BIG says the UK's reduced generating output has allowed prices to soar. It adds that slashed capacity margins – the average amount of extra electricity available compared with peak winter demand – are "so tight that National Grid's emergency power deals have become the norm".

Grant Shapps MP, who chairs the BIG, says the report focuses on the "dangerously small electricity capacity margins" that have been "left in the wake of a decade of target-led, interventionist energy policy".

He adds: "While nobody questions the noble intentions behind these interventions, it is clear that a perfect coincidence of numerous policies designed to reduce Britain's carbon dioxide emissions has had the unintended effect of hollowing out the reliability of the electricity generating sector".

Findings in the report claim that in recent winters the country's spare electricity margin has fallen from around 17% during the winter of 2011/12 to around 1% this winter.

The MPs warn that "there is a sustained danger of intermittent blackouts for the foreseeable future", and that this is down to "dwindling base capacity and freak weather events".

And to plug the capacity gap, household bills by 2020 could increase by as much as £30/year – nearly double Government estimates.

The price rise prediction comes as energy suppliers look to turn up the heat on customers in the form of higher tariffs – EDF last week became the first of the big six to confirm that it would increase its standard variable rates for electricity and dual fuel from next March.

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Additional reporting by the Press Association.