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Energy reforms will raise bills

By Sarah Tawton

Energy bills are set to rise over the next few years but will be pushed down by a "seismic shift" in Britain's electricity market by 2030, the energy secretary has predicted.

Chris Huhne said Government plans for a low-carbon energy future would mean higher gas and electricity bills for customers "in the medium term".

In a statement to the Commons, Mr Huhne said the Government wanted to see a "more diverse, lower carbon energy mix".

He added: "They (the reforms) will protect the consumer; while prices rise in the medium term, the additional impact of the reform packages will be small, but by 2030, consumer bills will be lower than if we did not reform the market.

"And they will lay the foundations for the sustainable economy of the future, bringing jobs up and down the supply chain."

The Lib Dem MP said the UK needed to double the investment rate of the last decade and attract more than £100 billion of investment in new power stations and grid connections by 2020.

Shadow energy secretary Meg Hillier welcomed the plans but warned they must provide "fairness and affordability for consumers".

She said: "We face this very big challenge together but we must not allow the consumer to bear the whole burden."

Ms Hillier said ministers had "dangled cheaper prices from 2030 in front of us" but they should ensure "energy prices today are being tackled as well". 

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