A whole range of things are happening at the moment that look likely to push up our energy bills, prompting a bewildering array of energy coverage and analysis in the media over the weekend. We sift through the stories.

Expensive energy

The government is “extremely close” to announcing a deal with French power company EDF for building new nuclear power stations in the UK. Energy minister, Ed Davey, told the Andrew Marr Show yesterday that the deal would bring in billions of pounds of investment from other countries including China, and help people with the energy bills in the long term by insulating them from the vagaries of international fossil fuel markets.

But it’s the short term that worries most people – specifically the amount consumers will pay toward the new generation. The FT reports that the government is set to guarantee the price of power the nuclear stations produce at around £90-92 per megawatt hour – almost twice the price of wholesale electricity.

And this comes just after energy company SSE announced last week that it plans to put up consumer energy prices by around eight per cent, appearing to blame the rise mostly on the amount the government spends on things like subsidising renewables, energy efficiency measures and new nuclear generation. The announcement was universally unpopular, but it’s likely the rest of the Big Six will follow suit.

Both announcements have refocused attention on what’s pushing up bills – and whether the government can do anything about it.

Green taxes 

SSE’s claims will “refocus attention on the cost of government green programmes,” the Financial Times wrote this weekend. The FT does exactly that in a whole range of stories over the weekend. Among other claims by SSE, it quotes figures by the company estimating that the carbon price floor – the government’s tax on carbon emissions – will add £26 a year to household bills by 2015.

Meanwhile, the Sunday Telegraph linked SSE’s comments on green taxes to reports that the number of windfarms granted planning permission in the UK has doubled. It says the news has stoked arguments within the coalition over whether or not subsidies to wind power should be cut.

In the buildup to the nuclear announcement, the Financial Times on Saturday also pointed out that the government expects green policies, including subsidies for nuclear and wind power, to push the price of electricity from £149 to £21 per megawatt hour by 2030. Government figures from March this year also assume energy efficiency policies will push bills down by 11 per cent thanks to energy efficiency measures such as the Green Deal. But the FT questions how likely these savings are to materialise given low takeup.

Reaction to SSE’s price rise hasn’t all worked in the company’s favour. While much of the reporting has focused on green taxes, the Guardian reports that Labour leader Ed Miliband has criticised the government for letting SSE “get away” with pushing up prices, trying to put the blame on others while awarding shareholders above-inflation dividend payouts. And consumers already seem to be voting with their feet: 50,000 have left SSE over the past few days, another Guardian report says.

Energy efficiency 

Energy efficiency plans – and the government’s hopes that they will cut bills – look like they’re going to take a further knock in the near future as a result of all the debate over energy bills. On Friday, the Guardian reported that Downing Street confirmed it is looking to cut another flagship efficiency policy, the Energy Company Obligation (ECO), in an attempt to bring down fuel bills. But critics say the plan makes little sense. One told the Guardian:

“The main reason our energy bills are so high is because we have some of the most energy-inefficient housing stock in Europe. ECO is the one policy that is helping cut fuel bills now.”

A wider look 

Somewhat lost in all the discussion over green taxes was the cost of wholesale gas – which to date still forms the largest chunk of households’ energy bills. The Sunday Times yesterday quoted Ed Davey pointing out that no-one can stop wholesale gas prices going up. The cost of upgrading the power network is also pushing up bills, he said.

Parliament also took a wider look, publishing a briefing document on why energy bills are going up. It concludes:

“Domestic prices have ratcheted up as higher operating, network and environmental costs and higher supplier margins have magnified the impact of longer term increases in wholesale costs.”

The only way for consumers to buffer themselves from higher prices will be to increase the energy efficiency of their homes, it adds. From this angle, the government’s plan to cut ECO looks a little different.

In recent months, energy coverage seemed to have broadened to include important debates on infrastructure and the future of the energy system as a whole. But if this weekend is anything to go by, newspapers seem to have decisively abandoned that brief dalliance with a return to arguments over rising energy bills and who’s to blame.

Note: While coverage focuses on SSE’s comments about green taxes, the company’s press release flags up three different factors for the rise. It points to the rising wholesale cost of energy, the increased costs of transporting energy through the network grid, as well as the cost of government levies.