UK Labour Party Promises to Freeze Energy Prices if Voted into Power

The next general election to determine the ruling party in government and the next Prime Minister of Great Britain, will be held in May 2015. Most polls show that the Labour party is in the lead and set to win, however the Conservative party of current Prime Minister David Cameron has recently begun to close the gap.

Labour leader Ed Miliband has recently made an announcement that could well see his party secure victory with ease. At the recent annual Labour conference in Brighton, Miliband promised to freeze natural gas and electricity bills until 2017 if his party is voted into power during the elections.

Business and consumer energy bills would be capped until January 2017, forcing energy suppliers to bear the increasing costs, which have been predicted to reach around £4.5 billion.

Ed Miliband.

Miliband declared that “the system is broken and we're going to fix it. If we win that election in 2015 the next Labour government will freeze gas and electricity prices until the start of 2017. Your bills will not rise. It will benefit millions of families and millions of businesses.

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The companies aren't going to like this because it will cost them more. But they've been overcharging people for too long because of a market that doesn't work. It's time to reset the market.”

British voters are likely to be attracted by the promise as energy costs have been rising far faster than wages in recent years, taking up an ever larger share of household income, and reducing the disposable income available for spending in the wider economy.

Labour’s energy spokeswoman, Caroline Flint, said that the party would also introduce reforms to the electricity market splitting up the energy generation and consumer sales businesses of the nation’s giant energy utilities, and requiring that all electricity be pooled and traded on the open market.

Britain is Europe’s largest consumer of natural gas, and has one of the top three traded electricity markets in the continent which is dominated by: Centrica, SSE, Scottish Power, EDF Energy, RWE npower, and E.ON.

By. James Burgess of Oilprice.com