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Electricity Market Reform

There is a sound argument in economic literature for encouraging early-stage technologies. Many British Governments have done that for many years. Green taxes are much lower than the estimates that have been bandied about recently in the press. We are committed to bringing forward in the annual energy statements our estimate of the overall impact of all our policies—not only the low-carbon policies, but the energy-saving policies—on consumer bills. The last time we did that, it was estimated that in 2020 our policies would add just 1% to consumer bills, and that assumed a world in which gas prices are lower than they are today and in which oil prices are only $80 a barrel, instead of $118 a barrel. If we want to protect British consumers against the vagaries of these markets that are buffeted by events, such as those in Libya and the middle east, we have to move to low-carbon sources of electricity. That is good news for British consumers, not bad.