Increase in future investment could lead to lack of cheap energy - 25/02/2009
A necessary increase in future investment in the UK's energy sector could result in a lack of cheap energy for consumers, reports the Financial Times.
Centrica, the parent company of major energy supplier British Gas, has commissioned a report from Ernst & Young which has found that energy companies will need to invest £234 billion over the next 15 years.
The money would be used to fund nuclear redevelopment, a variety of renewable projects and improvements to grid infrastructure but the sum is considerably higher than previous estimates and might have to be passed to the consumer.
Steve Jennings, head of power and utilities at Ernst & Young, told the paper: "A lack of confidence that future returns on new investment will be sufficient to cover financing costs means that there is an increased risk that the UK's energy investment needs will not be met."
Consumers may face higher prices from energy suppliers if the industry is to meet escalating cost estimates for the development of offshore wind farms and other renewable projects.
Energy suppliers have defended their recent profit margins by emphasising the need for future investment.
If you want to find out more about your energy options and how you could save up to £378 in minutes, click here.
Save up to £300 on your gas & electricity bills at energyhelpline.com
Compare prices from all energy suppliers to find your best deal