THERESA MAY has ordered a fast-track review of energy prices and said she aims to give British homes and businesses the lowest bills in Europe.

Theresa May orders energy price fast-track review as ministers aim to cut household bills

The investigation, which will look at the cost of production, including controversial environmental subsidies once dubbed “green ****” by David Cameron, could save consumers hundreds of pounds.

Experts have been given to the end of October to prepare proposals on how to cut prices.

The review follows the shock announcement last week that British Gas is to raise electricity costs for more than three million customers by 12.5 per cent, an average of £76 a year.

The Office for Budget Responsibility predicts that the cost of environmental levies will rise from £4.6billion two years ago to £13.5billion by 2022.

Critics claim that transmission costs have also risen because many wind and other renewable energy sources are too far away from population hubs.

Consumers need to see urgent action from the Government

Alex Neill

British Gas blamed the Government for its price rise, saying that green taxes would cost households an average of almost £150 a year from next year.

But minsters rejected those figures, suggesting that the new prices were unjustified.

Professor Dieter Helm, an Oxford professor and a former adviser to Tony Blair who will lead the review, said that “making people and companies pay excessively for policy and market inefficiencies” risked undermining objectives such as tackling global warming.

The review will recommend ways to keep energy prices as low as possible and deliver affordable energy in the future.

Prof Helm promised that his inquiry would be independent and “sort out the facts from the myths about the cost of energy”.

Energy Secretary Greg Clark said the Government wanted to “ensure we continue to find the opportunities to keep energy costs as low as possible, while meeting our climate change targets”.

The Department for Business, Energy and Industrial Strategy said: “The Government’s ambition is to have the lowest energy costs in Europe.” The independent panel has also been told that it must consider energy security to ensure the UK does not struggle to keep the lights on.

The review will look at issues including the closure of coal-fired power stations, ageing nuclear plants, the sporadic nature of some renewables, how to manage demand, new storage technology and the potential of electric vehicles, as well as energy and carbon pricing, energy efficiency and distribution costs.

Also on the table will be whether more competition could be used to drive down prices.

Prof Helm, an economist, has been an outspoken critic of the costs of renewable power.

The professor of energy has attacked the cost of wind farms and solar power and has also hit out at the cost of nuclear power.

“Current renewables like wind turbines, rooftop solar and biomass stand no serious chance of making much difference to decarbonisation,” he wrote in the Spectator magazine.

Alex Neill, of Which?, said the review must be turned into action as soon as possible.

“It is right to look at how to keep costs down, but yet another review is going to be cold comfort to the millions overpaying on their energy bills now.

“Consumers need to see urgent action from the Government and regulator to tackle the lack of competition in the market and to ensure they are getting a good deal.”

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