Boston Consulting Group has said high prices are driving down electricity consumption, making renewable subsidies and grid upgrades an increasing proportion of power bills, The Telegraph reports.
The average household electricity bill will rise by £264 by 2030 to hit £1,145 if demand continues to fall, according to BCG calculations.
This is because of a spike in net zero spending.
BCG’s Raoul Ruparel said: “There is a focus on the destination – how we will generate energy in the future – but that is less relevant if the path to get there is too costly.
“Britain isn’t an outlier because our system is more expensive: it’s largely because of how we’ve chosen to pay for it.”
Analysis by energy supplier EDF found household energy bills will rise by nearly £130 by the end of the decade as the costs of the Government’s net zero policies mount.
Typical annual household bills will hit £1,790 by 2030, up 8% from £1,663 today.
This is partly due to green levies and grid upgrades.
The latest estimate from EDF is £40 higher than its previous forecasts despite Labour’s pledge to cut energy bills by £300.
Sir Keir Starmer, during the 2024 election campaign, repeatedly promised that Labour would reduce household energy bills by £300 by the end of the decade.
Andy Burnham, who took over as Prime Minister in July, has said he wants to give people a “sense that help is coming” on prices.
At present, more than one in three households will struggle to afford their energy – just as bills are set to hit a three-year high.
Experts predict regulator Ofgem will today (August 26) announce another 4% increase in its price cap for tens of millions of households from October 1, taking typical bills £1,941 a year.
The latest bill shock is fuelled by the ongoing conflict in the Middle East.
