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U.K. Renewables Make Up 2% of Energy Bill Increases, Lobby Says

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Oct. 24 (Bloomberg) -- U.K. programs promoting the use of renewable power accounted for just 2 percent of the increase in consumer bills over two years, an industry lobby said, after Centrica Plc’s British Gas and RWE Npower Plc raised charges.

Renewables contributed 4 pounds ($6.40) to the average jump in a dual-fuel energy bill of about 205 pounds in the two years to July, the Renewable Energy Association said today, citing data from energy regulator Ofgem and the government. Gains in wholesale gas prices were among the main reasons for driving up energy costs, the industry group said in an e-mailed statement.

“The role of renewables in increasing energy bills is often greatly exaggerated,” Chief Executive Officer Gaynor Hartnell said. “The figures show it’s our reliance on fossil fuels that is costing us dear.”

Npower will increase power rates an average 9.1 percent and gas 8.8 percent on Nov. 26 and British Gas, the biggest natural-gas and power supplier to U.K. homes, will raise prices for both an average 6 percent from Nov. 16. Both blamed higher wholesale gas costs and clean energy policies. Those gains mean renewables add an even smaller proportion to bills, equivalent to 22 pounds of the average household payment this year, the lobby said.

Prime Minister David Cameron said Oct. 18 the U.K. would propose a measure to ensure consumers get the lowest rates, softening a remark a day earlier in which he said companies would be forced to give the lowest prices to customers.

To contact the reporter responsible for this story: Sally Bakewell in London at Sbakewell1@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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