SSEs announcement to fix energy prices to January 2016 saw David Cameron and Ed Miliband competing to claim the credit. With the other energy suppliers coming under pressure to follow SSEs example, lets consider what the real cost of this price freeze amounts to. And consider if there is really any credit to claim!
Labour announced a popular plan for an energy price freeze. Soon after, energy suppliers announced energy price rises the fault, we were told, lay with Green Taxes. Government reacted by cutting the one Government backed energy efficiency scheme that helped hard working households reduce their energy bills for years into the future. This cut allowed Government, in a deal with energy suppliers, to give back a one-off saving on energy bills this year or indeed an energy price freeze as SSE have announced. So a long term substantial saving for many is sacrificed for a short term saving for all that equates to between 70p to £1 a week.
But lets be clear, David Cameron did not cut a Green Tax in this deal, but rather a National Insurance programme. Not the National Insurance scheme taken from our salaries to cover us should we need hospital care, or have no company pension to fall back on but a national insurance scheme none the less. The Energy Company Obligation (ECO) protects us as a society, and individually, from the nasty surprises life might just hold for us. You may not have heard of the scheme, but if over the last decade you have been offered loft or cavity wall insulation or a subsidised boiler, you have come across it.
It is unlikely our political parties will be rushing to claim credit for any additions to National Insurance even if it does mean a cut to energy bills. Unless of course one of them feels like grasping the nettle and explaining why we wont have Green Taxes in the future but rather a national energy efficiency insurance policy worth the name.