'Stealth' Euro environmental measures add £60 to average electricity bill

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EU regulations designed to encourage energy suppliers to generate more electricity with renewable sources like wind and water have passed the cost on to consumers.

And The Government will also introduce a Carbon Emissions Reduction Target (Cert) in April to put further pressure on companies to become "green" – raising gas and electricity prices.

Energy regulators Ofgem, which also researched the effect of Brussels' Emissions Trading Scheme, expects electricity customers to each pay around £30 more this year as a result.

The Cert will force suppliers to reduce their annual carbon emissions by 1.1 million tonnes during the next three years - double the existing target under the Energy Efficiency Commitment (EEC).

The Department for Environment, Food and Rural Affairs (Defra), which is leading the initiative, said the overall cost of implementing the new target would be more than double that of the EEC.

The ETS, which puts a price on pollution emitted by energy providers and heavy industry, has also led to increased costs for customers.

It sets a cap on emissions as a whole in the EU and allows individual facilities to buy extra allowances or sell unused allocations.

Ofgem said typical domestic customers would face an extra £31 this year because of the scheme, which is already factored into wholesale energy costs.

The other environmental price pressure comes from the Renewables Obligation (RO), which asks suppliers to get extra electricity from renewable sources such as wind and hydroelectric plants.

The current renewables generation requirement is 7.9 per cent, due to rise to 15.4% by 2015/16. Ofgem said the stipulation currently adds around £10 to an electricity bill per year and is set to rise to £20 a year by 2015.

The regulator said: "Ofgem fully supports schemes like the European Emissions Trading Scheme which offer a market-based solution to tackling climate change.

"However, the impact of this scheme and the other environmental schemes ... does increase energy prices faced by customers."