Correspondence between the Chair of the Energy and Climate Change Committee and various publications (CE 36)
(CE 36a)
Letter fro m the Cha ir to the Daily Express, the Daily Mirror, The Daily Telegraph, the Financial Times, The Guardian, The Independent, The Independent on Sunday, The Observer, The Times, The Sun, The Sun on Sunday, the Sunday Express, the Sunday Mirror, The Sunday Telegraph and The Sunday Times
Concerns have been raised in evidence to the Committee’s inquiry into Consumer Engagement with Energy Markets that inaccurate reporting of the costs of ‘green’ energy policies, as levied on domestic energy bills, may be misleading the public. The Committee would like to offer you the opportunity to respond to these concerns in writing.
For exa mp le, Carbon Brief, stated in its written evidence:
Over the past nine months we have followed and analysed media coverage of ‘green’ policy measures and their impact on domestic energy bills in some detail.
In particular, we have noted a series of newspaper articles which overstate the current impact of green policies (or ‘environmental and social costs’) on energy bills. Some appear to be the result of simple errors (for example, confusing electricity prices with energy bills, or ignoring the impact of gas prices on bills), others are the result of research being reported in a what seems to us a highly partial or selective way.1
This view was supported by the Department of Energy and Climate Change, which stated that the impact of environmental and social policies in household energy bills had been “exaggerated” by some media reports when in fact the “costs of these policies represent around 7% of the current average household dual fuel bill”. 2
Ofgem analysis shows that Government programmes to save energy, reduce emissions and tackle climate change currently make up around 4% of gas bills and 10% of electricity bills, 3 and that “higher gas prices have been the main driver of increasing energy bills over the last eight years.” 4 Similarly, Committee on Climate Change analysis has shown that “it is not the case that energy bills are currently high due to costs of low-carbon measures”, with the £455 increase in household energy bills between 2004 to 2010 being “primarily in response to increased wholesale gas costs”. 5 On future costs, the CCC has also found that “it is not the case that future investments in low-carbon capacity will drive very dramatic increases in energy bills by 2020”. 6
1 CE 23 paras 1 and 2 (Carbon Brief) written evidence to the Committee, March 2012. 2 CE 01, para 44 (DECC) written evidence to the Committee, March 2012. 3 Ofgem Updated household energy bills explained (31/ 05/ 12) Factsheet 97 4 Ofgem Why are energy prices rising? (14/ 10/ 11) Factsheet 108 5 Committee on Climate Change (December 2011) p. 14 Household energy bills - impacts of meeting carbon budgets 6 Committee on Climate Change (December 2011) p. 26 Household energy bills - impacts of meeting carbon budgets Concerns have also been raised about the “very polarised” nature of energy and climate coverage in the media and the possibility that this creates “a pressure to find facts which fit stories rather than the other way round.” 7
The Committee would like to offer you the opportunity to respond to the concerns that have been raised in this inquiry before it considers its final report. Please find attached specific questions on which it would be particularly helpful to have your comments.
In addition to these questions, the Committee would welcome your comments on the wider question, “What impact does the media have on public perceptions of energy bills?”, which forms part of the inquiry’s terms of reference.
Please note that the Committee would normally expect to publish your response as written evidence to this inquiry. Thank you in anticipation of your assistance.
Questions on which the Committee would welcome your comme nts
1. The Committee has heard that energy and climate coverage in the media tends to be “very polarised” and that this “seems to create a pressure to find facts which fit stories rather than the other way round.” 8 How do you respond to the suggestion that the media “tends to favour and promote explanations or projections which fit with their editorial line” 9 when reporting on the cost to consumers, in their energy bills, of public investment in renewable energy?
2. Analysis from Ofgem and the Committee on Climate Change shows that the rising wholesale price of gas is the main driver pushing up consumer energy bills. 10 How do you respond to the suggestion that despite “clear and consistent evidence” that this is the case, “it is apparent from recent coverage that this message has failed to reach some sections of the UK media”?11
3. The Committee has received evidence that some news publications “have relied on unverifiable leaked reports or skewed research by think-tanks and individual consultants” when reporting on the effect of renewable energy policies on domestic energy bills, and that these news reports, “particularly the headlines, are highly selective in their use of facts and can often be open to accusations of bias.”12 What steps, if any, does your publication take to ensure that it complies with the Editors' Code of Practice and does not publish “inaccurate, misleading or distorted information” when reporting on these issues?
4. What impact does the media have on public perceptions of energy bills?
17 October 2012
7 Christian Hunt (18/ 09/ 12) Uncorrected evidence to the Energy and Climate Change Committee, Q207 8 Christian Hunt (18/ 09/ 12) Uncorrected evidence to the Energy and Climate Change Committee, Q207 9 CE 23 para 36 (Carbon Brief) written evidence to the Committee, March 2012. 10 Ofgem Why are energy prices rising? (14/10/11) Factsheet 108; Committee on Climate Change (December 2011) p. 14 Household energy bills - impacts of meeting carbon budgets 11 CE 13 (Scottish Renewables) written evidence to the Committee, March 2012. 12 CE 13 (Scottish Renewables) written evidence to the Committee, March 2012. (CE 36 b)
Letter from Jonathan Leake at The Sunday Times to the Chair
Thank you for your letter requesting written evidence for your inquiry into Consumer Engagement with the Energy Markets.
Your letter was prompted by concerns raised in your inquiry that inaccurate reporting of the costs of green energy policies could be misleading the public. You cited Carbon Brief and the Departme nt of Energy and C limate C hange as expressing such concerns. Your key point seemed to be that low carbon energy has added only 7% to the current average household dual fuel bill, whereas fluctuations in fossil fuel prices, especially gas, have had a far greater effect – but that this distinction has not been clearly made in the media.
I note that The Sunday Times appears not to have been cited as a source of such reports so I am happy to make some general comments on that basis. I have also carried out a search o f our cuttings database and have attached a separate file containing 170+ articles published by us in the last two years. The search term used was simply “energy bills” so the results should represent all our stories on this topic since October 2010.
As you will see, most of the more recent articles looking at energy bills are actually about the overall costs and increases. These have been highlighted in blue and there seem to be more than 50 of these. Many of them mention the cost of gas as a primary cause of recent price rises.
Only a relatively small proportion focus on how low carbon generation might lead to increases in domestic energy bills. I have highlighted the headlines of these articles, including reports of the political debates on this issue, in ye llo w. There seem to be about 24 of these.
Many other articles focus on the possible energy and money that could be saved by greening homes and energy systems. These have been highlighted in green. There seem to be more than 50 of these.
As you will see, some articles do not fit easily into any of these categories. They have been left unhighlighted, as have readers’ letters.
Overall then, you will see that that there are far more articles focusing on the benefits of green technologies, whether in people’s homes or in power generation, than there are articles about the costs. This suggests that the allegation put to you that media coverage of energy and climate is polarised does not apply in our case. In fact I would argue that, on the evidence of these articles, our coverage has been very balanced.
You also raise suggestions that some sections of the media have an editorial ‘line’ on climate and energy-related issues. In our case there is no such thing as an editorial line in news reporting on such issues. Our reporting of climate change aims to follow the science and the debates generated by that science, especially on how society should respond to the threat of global warming. Columnists may express their own personal opinions but are expected to back up those opinions with good quality evidence where appropriate. Inevitably, different columnists may express very different opinions and we encourage this diversity rather than dictating any kind of editorial line. We feel that readers of The Sunday Times appreciate a range of opinions rather than being told what to think. Moving on, to the cause of energy price rises, our articles have made it clear that gas is the primary cause of recent increases. However, the concern over the cost of low carbon energy is not the amount added to bills now, when capacity is quite small. Instead, the real concern is over what it will cost in future as the proportion, and amount, of wind, nuclear and other low carbon generation rises. This is a legitimate concern and is the focus of many of the articles highlighted in yellow.
Finally, the suggestion raised by your other witnesses that “some news publications have relied on unverifiable leaked reports or skewed research by think tanks” is vague and very hard to answer without specific examples. I think the best approach here is for you to read the attached reports to see if you believe any of them fit into this category and we can then reply to the specific points raised.
Generally, however, I think you will find that most articles dealing with reports by ‘think tanks” or similar bodies will contain balancing comments from other experts too, either underlining or undermining the claims being made according to the strength of the supporting evidence.
I hope these comments and the attached reports will be useful in your inquiry. Please feel free to come back to us with any further questions.
17 November 2012
Annex
Blue. – List of articles that were highlighted in blue [i.e. articles about overall costs and increases to energy bills (headlines only for copyright reasons).]
This is how you can clean up the energy sector, Mr Cameron – 21 October 2012
Lower-risk funds to beat inflation; Rising prices could wipe out returns, says Holly Thomas – 16 September 2012
Act fast to catch the best fixed-price energy deals; Bargains are disappearing from the market, writes Ali Hussain – 2 September 2012
Watchdog stops oil supporters turning up home heating bills; Customers can save by joining local club, says Melanie Wright – 5 August 2012
Co-op raises energy bills; BRIEFING – 5 August 2012
Battle for North Sea oil revenue ‘ignores decline’ – 22 July 2012
Cold comfort as energy bills climb; Direct debits need to go up to avoid going into the red, writes Ali Hussain – 22 July 2012
Fury as British Gas profits jump 25%; Energy giant cashes in on soaring power bills as 1 in 5 houses faces fuel poverty – 22 July 2012
How to beat inflation in your retirement; The elderly are struggling with rising prices. Jessica Bown looks at steps to make every penny count – 24 June 2012 Knight rides in to save energy – 13 May 2012
French threaten non to nuclear; The new socialist president could make Britain a no-go zone for France’s power companies, says Danny Fortson – 13 May 2012
Laidlaw ready to be clawed – 6 May 2012
Shale gas boom stalls – 15 April 2012
MELTDOWN; When the German power giants Eon and RWE pulled the plug on their UK nuclear power plants, they left Britain’s energy policy in tatters. Danny Fortson reports – 1 April 2012
Cut the volts for shock saving; Most electrical appliances don’t need the high voltage supplied in your mains, writes David Derbyshire – 25 March 2012
How foreign suppliers squeeze British homes; We pay more for our power as European utility firms target UK to boost profits, writes Alexandra Goss – 26 February 2012
Fixed deals dilemma for energy customers; Falling prices mean it could be worth paying exit penalty, writes Ali Hussain – 15 January 2012
Save £6,000 on your bills; Beat the squeeze in the new year by shopping around for the best deals, says Alexandra Goss – 1 January 2012
Prepare for better news on your bills next year; Household costs rose a record amount in 2011, but at least fuel prices have peaked – 18 December 2011
Energy giants pocket £1billion; Utility firms fail to pass on benefits of falling power costs, says Ali Hussain – 27 November 2011
Energy firms pull web deals; Move to simplify bills hits online offers. By Ali Hussain – 6 November 2011
Huhne’s top tips save just £1 a week – 23 October 2011
THE WONDER GAS THAT COULD CUT YOUR ENERGY BILL; It is said to be cleaner, cheaper and more abundant than the ‘natural’ form. So could shale gas save us from higher prices? Tim Rayment reports – 23 October 2011
Where to go to beat inflation; Savers are being forced to take risks, so make sure you know just what you are getting, writes James Charles. MONEY MoT Part 4: SAVINGS – 23 October 2011
Why fixing your energy bills may be a mistake – 23 October 2011
POWER STRUGGLE; Ministers and energy giants need to stop blaming each other for soaring bills and be honest why consumers are heading for a big shock, reports Danny Fortson – 16 October 2011
Don’t bank on bulk to beat energy giants, The government is eyeing Groupon-style schemes, but they are not all they are cracked up to be. By Alexandra Goss Freeze your bills this winter; You may have switched once but it doesn’t mean you still have the best deal on utilities, loans and insurance. Niall Brady reports – 11 September 2011
Energy bills up; N EWS IN BRIEF – 4 September 2011
THE WEEK IN REVIEW – 21 August 2011
Get your finances set for slow growth; With the economy stalled but inflation set to jump, families face tough choices on whether to go for fixed rates on bills and saving, writes Alexandra Goss – 14 August 2011
The budget plan balancing act; Options that take the stress out of paying household bills can come at a price. Niall Brady investigates good value and reveals some of the pitfalls – 14 August 2011
Group buying spreads to solar; Insurers and broadband providers also offer deals, Alexandra Goss reports – 7 August 2011
Act fast to cut bills as Eon raises prices – 7 August 2011
Scottish energy boss gets £2m perk as power prices rocket – 24 July 2011
Next time you scent the stench of a gas bill, strike a match – 24 July 2011
More pain as power giants raise prices; Big three energy suppliers to follow British Gas and Scottish Power with £200 increase – 24 July 2011
Energy bills to rise; TOP STORIES FROM THE UK AND IRELAND – 17 July 2011
Npower bills hit low users – 17 July 2011
Best ways to fight against rising inflation – 17 July 2011
Germans spark £5bn Npower sale; British electricity supplier could be sold as owner RWE struggles to pay down enormous debts – 3 July 2011
Prices soar in dash for gas; With nuclear power under a cloud, demand for gas will rocket, writes Danny Fortson – 12 June 2011
Beat the big energy bill rises and fix now; Householders urged to act as Scottish Power leads the utilities in a fresh round of increases, reports Ali Hussain – 12 June 2011
Fears over gas prices; BRIEFING – 22 May 2011
Cost of energy to hit record level – 8 May 2011
What the Japan chaos means for mortgages; Interest rates could stay lower for longer but energy bills will have to go up, report James Charles and Ali Hussain – 20 March 2011
Energy bills to rise — again - 13 March 2011
School’s D minus for waste – 6 February 2011 How to be £2,000 richer in 2011; Household budgets will be hit hard this year, but our tips will keep you afloat. By Ali Hussain – 2 January 2011
Watchdog lays down the law to energy firms – 2 January 2011
End of year checklist: beat the pain of price rises in 2011; Vat, tax and energy will pile on the pounds, says Alexandra Goss, so trim home and car costs now NAZARD AVOIDANCE – 12 December 2010
Gas firms to raise prices in big chill – 5 December 2010
Centrica has the power to spread gains; INSIDE THE CITY – 5 December 2010
Put the brake on soaring bills; As if rising energy bills were not enough, car cover is also on the rise. Alexandra Goss looks at how to keep to your budget – 7 November 2010
Green – List of articles that we re highlighted in green [i.e. articles about possible energy and money that could be saved by greening homes and energy systems (headlines only for copyright reasons).]
A warmer welcome; Insulation slashes energy bills, but what else can you do besides lining the loft? There are many ways to hot things up at home, says Ross Clark – 28 October 2012
Warm Front; The government launches it Green Deal next month, but it will take until the new year to kick in. Cherry Maslen explains how to cut bills now – 23 September 2012
£10,000 loans for eco homes – 15 July 2012
Catching some rays; With feed-in tariffs dropping and energy prices rising, are solar panels still worth it, asks Cherry Maslen – 8 July 2012
Low energy is boost for sale price of homes – 8 July 2012
Make it a hot property; Hefty energy bills can put buyers off big country houses. Cally Law meets a couple who have fired up interest in their home by going green – 17 June 2012
Green homes plan under fire; A controversial scheme to cut household fuel bills faces its first test, writes Oliver Shah – 10 June 2012
Extra time to generate returns on solar schemes; There will be a month’s delay to the cut in fe ed-in tariffs, but should you rush in? Alexandra Goss reports – 27 May 2012
Insulate to accumulate; Making your home more energy-efficient has never been easier — or cheaper — thanks to a host of grants and incentives. By C herry Maslen – 22 April 2012
A painless way to offload your guilty green secret – 15 April 2012
Take steps to cut your household energy bills; Switch to a cheaper deal and make your home more efficient, writes Ali Hussain – 15 April 2012
Minister wants to wrap Britain’s period homes in 8in of cladding – 25 March 2012 Turn that light off and let the sun in; Strip out theose fluorescent bulbs. New technology can harness natural light instead, says Mark Harris – 18 March 2012
The best apps for your new iPad; From energy bills to eating out, the latest gadgets help you save more and spend less, says John Greenwood – 18 March 2012
Now, how do I keep your home warm? Too few people have been trained to make our homes energy efficient, says Karl West – 11 March 2012
To save on power, just phone home; GREEN PIONEERS Colin Calder’s smart systems control energy consumption – 5 February 2012
MEET THE A TEAM – 29 January 2012
Greenhouse effects; Window sealant – 29 January 2012
Time for a cash diet – 8 January 2012
End of the road for petrol cars; by 2050, say ministers, all cars and vans must run on low- carbon electricity. Jonathan Leake reports – 4 December 2011
Clear winner; This year’s Riba Manser architecture prize has gone to a 1960s home that has been stripped back to the bare essentials, says Hugh Graham – 13 November 2011
Try a wee dram of the green stuff; Whiskey makers are using their waste to produce electricity. Matthew Goodman reports – 30 October 2011
Job done: £1,200 off bills and emissions cut by 70%; A draughty old home is being used to test the new Green Deal. Can it convince hard-up families to take action, asks Oliver Shah – 23 October 2011
The ‘€25k house’ can change our lives – 9 October 2011
Turn up the heat with Marmite; leftovers of the ‘love it or hate it’ spread will be recycled to generate energy at the plant where it’s made, reports Karl West – 2 October 2011
That’s beautifully efficient; Passive houses have had a bad name for putting mathematics ahead of aesthetics — until now, discovers Mark Keenan – 2 October 2011
RETROFITTING CAN SAVE HOUSEHOLDS AN [...] – 25 September 2011
I’m going to tackle my energy costs before the lights go out; In the first of a series, former Money editor of the ‘squeezed middle’ Naomi Caine counts the pennies – 21 August 2011
Energy-filled house means zero bills – 21 August 2011
Sun sets on solar power subsidies – 31 July 2011
Council houses are made of straw; Local authorities across the country are rushing to embrace traditional building methods, says Michael Wale – 31 July 2011
Stop the drain on your finances; Bathing with a friend is all very well, but fitting a water meter could be more effective in cutting costs, says Cally Law – 31 July 2011 Wind is behind Jenson’s boffin; GREEN PIONEERS Ben Wood’s Anakata is using Formula One technology to build smaller, more powerful turbines, writes Oliver Shah – 24 July 2011
Turning a profit; Wind turbines aren’t cheap to install, but those blades can shred your energy bills, writes Niall Toner – 17 July 2011
The town with a warm, green heart; A communal heating system will help Cranbrook in Devon to become a low-carbon community, says Oliver Shah – 10 July 2011
Does solar power still pay its way? The returns from installing panels could be lower than predicted, writes Alexandra Goss – 10 July 2011
Making money while the sun shines; SWITC HED ON – 10 July 2011
Power houses; Energy from the sun could cut your bills by €1.000 a year. Mark Keenan compares the different systems on offer – 3 July 2011
Soak up the savings; Free warmth from outside your door — green dream or a load of hot air? Cally Law explains how it can work for you – 3 July 2011
Being energy-efficient can heat up your fuel costs; Complex rates mean lowest usrs face the steepest rises, writes Ali Hussain – 19 June 2011
The heat is on; With energy prices set to go through the roof, Cherry Maslen tells you how to save power — and generate your own – 12 June 2011
M&S could soon be insulating your home; High street names may back government’s energy-efficiency drive. By Alexandra Goss – 5 June 2011
Ways to take revenge on the utility giants; Households can make huge savings by thining small, says Ali Hussain – 15 May 2011
Go green and be paid to drive your new car; Invest in solar panels and an electric vehicle and you could make a profit, says Ali Hussain – 8 May 2011
Formula O ne trains van drivers; The Williams team is putting Sainsbury’s on the road to energy savings, says Karl West – 1 May 2011
Seal approval; This airtight Victorian eco-home has no draughts — and energy bills of just £100 a year, says John Elliot – 20 March 2011
Insulation, not eco bling, is the key to green living, says Prince Charles – 6 March 2011
The power station in my bathroom; GREEN PIONEERS Adrian Hutchings created a boiler that generates electricity, reports Kasmira Jefford – 20 February 2011
Talking about our generation; Will green households lose out as the government reviews its incentives for home-grown energy production, asks Rob Kingston – 20 February 2011
Come on you greens; Rio Ferdinand, the England captain, is on a mission to become Britain’s eco-frie ndliest footballer. He tells Laura Latham why – 6 February 2011 Shocked by the power; As energy bills soar, Caroline Scott asks a meter man how to slash costs (step one: ban halogen lights) – 30 January 2011
A window of opportunity; There’s more to glass than meets the eye, so don’t overlook its importance, says Cherry Maslen – 2 January 2011
HARNESSING YOUR POWER; ADVERTISING PROMOTION Sit back and relax, while EDF Energy’s new EcoManager monitor helps you to start cutting your bills – 14 November 2010
Got a £100m home to heat? Better dig deep – 7 November 2010
Huhne’s Green Deal leaves landlords in disarray – 7 November 2010
Ye l lo w – List of articles that were highlighted in yellow [i.e. articles about how low carbon generation might lead to increases in domestic energy bills (headlines only for copyright reasons).]
Monster power bills leave the public shivering; ENERGY AND ENVIRONMENT Consumers are having to bear the cost of big subsidies in the battle against climate change. Danny Fortson reports – 28 October 2012
Snuffed out; BRIEFING LIGHT BULBS The 100-year-old incandescent light bulb is going dark. The energy-hungry bulb has been banned by the EU but, reports Josh Glancy, householders are finding ways around the law – 2 September 2012
Trump blow to subsidies for turbines; American billionaire supports Tory critics of Westminster’s policy on renewable energy, writes Mark Macaskill – 22 July 2012
Energy prices to surge – 15 July 2012
Nuclear talks heat up – 1 July 2012
Something rotten blows in; A pay scandal in Denmark could take the wind out of Britain’s green sails. By Bojan Pancevski – 8 April 2012
Wind adds £45bn to cost of climate change targets – 4 March 2012
Yo-ho-ho! Give us a buccaneer’s budget – 26 February 2012
THE GREAT WIND ROBBERY; Opinion is divided on who gains from Alex Salmond’s ambition for Scotland to be the ‘Saudi Arabia of renewables’, writes Gillian Bowditch – 19 February 2012
Green energy could blot out countryside – 20 November 2011
Ditching wind farms ‘will save £34bn’; A new study says Britain can hit its carbon targets more cheaply with gas and nuclear power. Danny Fortson explains how – 6 November 2011
Solar left in the shade by marine funds – 23 October 2011 Osborne angers No 10 by stalling green energy boost – 9 October 2011
Cost of £200m jeopardises Lewis wind farm scheme – 21 August 2011
Householders face big upfront costs in British Gas green plan; Loans may take years to pay for themselves, writes Ali Hussain – 24 July 2011
Huhne sparks £200bn clean energy shake-up; Household bills set to double over decade to pay for nuclear power and wind farms – 10 July 2011
Industry rebels on carbon targets; Chemical firms lead calls to halt a leap in costs that could lead to the loss of hundreds of thousands of jobs. Report Danny Fortson – 22 May 2011
Energy policy in meltdown; The disaster at Fukushima has delayed plans to create a low carbon power industry in Britain, writes Danny Fortson – 1 May 2011
Airtricity faces inquiry on bills; Direct debit customers amass debts of up to €1,500 after ‘systems glitch’ at energy firm, writes Mark Keenan – 24 April 2011
Carbon P lan could double householders’ energy bills – 13 March 2011
Chemicals cry for help – 6 February 2011
Low carbon comes at high price – 19 December 2010
Your £130bn bill for green energy; A minister says householders must pay ‘significantly’ more to ensure cleaner, secure power, writes Jonathan Leake – 5 December 2010
(CE 36 c)
Letter from John Thornhill, Deputy Editor, Financial Times, to the Chair
1. In our news coverage, the Financial Times has for 124 years attempted to report the objective facts of any story as best it can without ideological slant. Our readers, who often invest on the basis of information published by the FT, expect us to provide accurate, timely and relevant reporting. They are our best regulators; they certainly let us know- often in forceful terms - if they think we are providing inaccurate or partial information or have been hoodwinked by a particular lobby group.
2. We endeavour to draw a clear distinction between news and comment. But even when we do publish strong opinions in our editorial columns or from our columnists or outside contributors, we aim to do so on the basis of verifiable facts. As a matter of policy, we correct material errors whenever they are brought to our attention and amend our online stories accordingly.
3. The first line of accurate reporting always has to be the reporter. In the case of the environment, we have appointed one of our most trusted and experienced reporters, Pilita Clark, to cover the beat. She is supported in London by Clive Cookson, our science editor, and a team of energy reporters, including Guy Chazan and Sylvia Pfeifer, who are also first- rate journalists.
4. The FT still has a largely reporter-driven news culture so most of the stories we cover on climate change and the environment are generated by our correspondents. They discuss their story ideas with the relevant section editors (eg UK news, World, Companies, Markets, Analysis) who will decide whether to commission a story.
5. Once the article is filed, the line editor scrutinises the copy for accuracy, concision and impact and ensures it does not contain "inaccurate, misleading or distorted information". The story will then be read again by a sub-editor before it is published online or in the newspaper. The sub-editor will write the headline and stand-first for the story with the aim of enticing readers to take an interest in the article without betraying its accuracy.
6. If unsure about the sourcing of the story, the line editor will challenge the reporter on the reliability of the information. Our own editorial guidelines insist on a reporter having at least two sources for any story. We will, as a matter of practice, aim to put any contentious claims to the party concerned.
7. If line editors are in doubt about a particular story, they will ask a more senior editor for their view. We also have an in-house lawyer, sitting on the news floor, who is regularly consulted about contentious stories and any concerns over legal or compliance issues.
5 December 2012
(CE 36 d)
Letter from Benedict Brogan, Deputy Editor, The Daily Telegraph, to the Chair
Thank you for your letter addressed to Tony Gallacher, Editor of the Daily Telegraph. He has asked me to reply.
You suggest that concerns have been raised in evidence to the Committee’s inquiry into Consumer Engagement with Energy Markets that inaccurate reporting of the costs of ‘green’ energy policies, as levied on domestic energy bills, may be misleading to the public. The concerns appear to have been raised by single issue lobbying organisations. You asked for our thoughts, and I am happy to be able to make the following points in the hope that they might assist the committee.
1. The costs of green energy are hotly disputed but we report all sides of the debate. This is our report of the climate change committee’s suggestion that the costs of green energy are exaggerated:
http://www.telegraph.co.uk/earht/environment/8957137/Green-energy-will-only-add- 100-to-bills.html
2. We have published a number of articles suggesting that gas prices are to blame for soaring bills. At the same time, companies – SSE, Scottish Power, British Gas – a lso point out the green taxes are part of the reason why they are putting up prices, on top of wholesale rises, see:
http://www.telegraph.co.uk/finance/personalfinance/consumertips/household- bills/9493143/Five-million-ho me s-fa ce-shock-energy-rise.html
And:
http://www.telegraph.co.uk/earth/energy/9575477/families-fac e-sharp-r ise-in-winter- energy-bills.html
3. This is our report of the Government’s position:
http://www.telegraph.co.uk/news/9282705/Households-to-pay-around-100-more-a- year-fo r-electricity-by-2030.html
The Government position on how much going green will cost is confusing and lacks transparency. There are no estimates of how much energy would cost without any environmental taxes or carbon trading.
The report says that without the green reforms of the Energy Bill, household bills would be £200 higher. But it’s “no reforms” scenario still includes the effects of carbon trading and the carbon floor price, which artificially raise prices by making gas and coal generation more expensive and wind/nuclear more economic in comparison. Think-tanks have warned the Government is underestimating the cost of green reforms and issues misleading figures:
http://www.policyexchange.org.uk/media-centre/in-the-news/category/item/row-over- cost-of-p la ns-fo r-green-energy
4. Experts/consumer groups are also worried about the impact of green taxes:
http://www.telegraph.co.uk/news/9509020/Green-taxes-on-fuel-bills-nearly-double- website-says.html
http://www.telegraph.co.uk/earth/environment/climatechange/9137213/Consumer- watchdog-Which-co nde ms-green-tax.html
On a more general point, I am uneasy that a Committee of the House of Commons appears to be asking a newspaper to justify its reporting on a particular issue based on vague, partisan criticisms from lobby groups with an interest in the issue. If any of these organisations wishes to complain about any aspect of our reporting, the appropriate forum is the Press Complaints Commission, or in the event of a libel, the Courts. We are anxious to help the committee in any way possible, but I would deplore any attempt by third parties to use your committee to settle scores with the media.
8 November 2012
(CE 36 e )
Le tte r fro m Tim Jotischky, Deputy Editor, The Sunday Telegraph, to the Chair
Thank you for your letter addressed to Ian MacGregor, Editor of the Sunday Telegraph. He has asked me to reply.
You suggest that concerns have been raised in evidence to the Committee's inquiry into Consumer Engagement with Energy Markets that inaccurate reporting of the costs of 'green' energy policies, as levied on domestic energy bills, may be misleading the public. The concerns appear to have been raised by single issue lobbying organisations. You asked for our thoughts, and I am happy to be able to make the following points in the hope that they might assist the committee.
1. The costs of green energy are hotly disputed but we report all sides of the debate. This is our report of the climate change committee' s suggestion that the costs of green energy are exaggerated: http://www.telegraph.co.uk/earth/environment/8957137/Green-energy-will-only-add-100-to- bills.html
2. We have published a number of articles suggesting that gas prices are to blame for soaring bills. At the same time, companies - SSE, Scottish Power, British Gas – also point out that green taxes are part of the reason why they are putting up prices, on top of wholesale rises, see: http://www.telegraph.co.uk/finance/personalfinance/consumertipslhouseholdbills/9493143/Fi ve-million-homes-face-shock-energy-rise.html and: http://www.telegraph.co.uklearth/energy/9575477/Families-face-sharp-r is e-in-winterenergy- bills.htrnl
3. This is our report of the Government's position: http://www.telegraph.co.ukJnews/9282705/Households-to-pay-around-l OO-more-ayear-for- electric ity-by-2030.html
The Governme nt position on how much going green will cost is confusing and lacks transparency. There are no estimates of how much energy would cost without any environmental taxes or carbon trading.
The report says that without the green reforms of the Energy Bill, household bills would be £200 higher. But its "no reforms" scenario still includes the effects of carbon trading and the carbon floor price, which artificially raise prices by making gas and co a l ge neration more expensive and wind/nuclear more economic in comparison. This skews the comparison. Think-tanks have warned the Government is underestimating the cost of green reforms and issues misleading figures: http://www.policyexchange.org.ukJmedia-centre/in-the-news/categorylitem/row-overcost-of- plans- fo r-green-energy
4. Experts/consumer groups are also worried about the impact of green taxes: http://www.telegraph.co.ukJnews/9509020/Green-taxes-on-fuel-bills-nearly-doublewebsite- says.htrnl http://www.telegraph.co.ukJearth/environment/climatechange/9137213/Consumerwatchdog- Which-condemns-green-tax.htrnl
On a more general point, I am uneasy that a Committee of the House of Commons appears to be asking a newspaper to justify its reporting on a particular issue based on vague, partisa n criticisms fro m lobby groups with an interest in the issue. If any of these organisations wishes to complain about any aspect of our reporting, the appropriate forum is the Press Complaints Commission, or in the event o f a libel, the Courts. We are anxious to help the committee in any way possible, but I would deplore any attempt by third parties to use your committee to settle scores with the media.
7 November 2012 (CE 36 f) Letter from the Chair to The Sunday Telegraph
Claims made by Christopher Booker last Sunday "It is wind power that will send our bills sky-high" are grossly exaggerated.
Firstly he claims that "George Osborne's carbon tax due next April.....alone will double our energy bills". This exaggerates its impact no less than 25 times as the Treasury's published calculations show that by 2017 electricity prices will actually be 4 per cent higher as a result of this measure.
Secondly he claims that Britain will build 30,000 wind turbines before 2020. This is four times more than the true figure of 7,000 published in the Government's Renewable Energy Roadmap.
Thirdly he claims these turbines will cost £100 billion. As the draft Energy Bill makes clear, total investment in electricity generation will be £75 billion and this includes all new investment in gas fired power stations and nuclear power, as well as all types of renewable energy - not just wind. The actual cost of new wind turbines is therefore only a fraction of the amount claimed.
Booker's disregard of the facts does not inspire confidence in his conclusions.
24 October 2012
(CE 36 g) Letter fro m the Cha ir to the Daily Mail and The Mail on Sunday
Concerns have been raised in evidence to the Committee’s inquiry into Consumer Engagement with Energy Markets that inaccurate reporting of the costs of ‘green’ energy policies, as levied on domestic energy bills, may be misleading the public. The Committee would like to offer you the opportunity to respond to these concerns in writing.
For example, Carbon Brief, stated in its written evidence:
Over the past nine months we have followed and analysed media coverage of ‘green’ policy measures and their impact on domestic energy bills in some detail.
In particular, we have noted a series of newspaper articles which overstate the current impact of green policies (or ‘environmental and social costs’) on energy bills. Some appear to be the result of simple errors (for example, confusing electricity prices with energy bills, or ignoring the impact of gas prices on bills), others are the result of research being reported in a what seems to us a highly partial or selective way.13
This view was supported by the Department of Energy and Climate Change, which stated that the impact of environmental and social policies in household energy bills had been
13 CE 23 paras 1 and 2 (Carbon Brief) written evidence to the Committee, March 2012. “exaggerated” by some media reports when in fact the “costs of these policies represent around 7% of the current average household dual fuel bill”. 14
Ofgem analysis shows that Government programmes to save energy, reduce emissions and tackle climate change currently make up around 4% of gas bills and 10% of electricity bills, 15 and that “higher gas prices have been the main driver of increasing energy bills over the last eight years.” 16 Similarly, Committee on Climate Change analysis has shown that “it is not the case that energy bills are currently high due to costs of low-carbon measures”, with the £455 increase in household energy bills between 2004 to 2010 being “primarily in response to increased wholesale gas costs”. 17 On future costs, the CCC has also found that “it is not the case that future investments in low-carbon capacity will drive very dramatic increases in energy bills by 2020”. 18
Concerns have also been raised about the “very polarised” nature of energy and climate coverage in the media and the possibility that this creates “a pressure to find facts which fit stories rather than the other way round.” 19
The Committee would like to offer you the opportunity to respond to the concerns that have been raised in this inquiry before it considers its final report. Please find attached specific questions on which it would be particularly helpful to have your comments.
In addition to these questions, the Committee would welcome your comments on the wider question, “What impact does the media have on public perceptions of energy bills?”, which forms part of the inquiry’s terms of reference.
The Committee would further welcome your comments regarding the evidence we have received from Carbon Brief that the Daily Mail and the Mail on Sunday have reused inaccurate figures on several occasions, even after they had printed corrections to those figures following successful complaints to the Press Complaints Commission. Please see the attached excerpt from Carbon Brief’s written evidence outlining the details. 20
Please note that the Committee would normally expect to publish your response as written evidence to this inquiry.
Questions on which the Committee would welcome your comme nts
1. The Committee has heard that energy and climate coverage in the media tends to be “very polarised” and that this “seems to create a pressure to find facts which fit stories rather than the other way round. ”21 How do you respond to the suggestion that the media “tends to favour and promote explanations or projections which fit with their
14 CE 01, para 44 (DECC) written evidence to the Committee, March 2012. 15 Ofgem Updated household energy bills explained (31/ 05/ 12) Factsheet 97 16 Ofgem Why are energy prices rising? (14/ 10/ 11) Factsheet 108 17 Committee on Climate Change (December 2011) p. 14 Household energy bills - impacts of meeting carbon budgets 18 Committee on Climate Change (December 2011) p. 26 Household energy bills - impacts of meeting carbon budgets 19 Christian Hunt (18/ 09/ 12) Uncorrected evidence to the Energy and Climate Change Committee, Q207 20 CE 23 paras 12 to 24 (Carbon Brief) written evidence to the Committee, March 2012.
21 Christian Hunt (18/ 09/ 12) Uncorrected evidence to the Energy and Climate Change Committee, Q207 editorial line” 22 when reporting on the cost to consumers, in their energy bills, of public investment in renewable energy?
2. Analysis from Ofgem and the Committee on Climate Change shows that the rising wholesale price of gas is the main driver pushing up consumer energy bills. 23 How do you respond to the suggestion that despite “clear and consistent evidence” that this is the case, “it is apparent from recent coverage that this message has failed to reach some sections of the UK media”?24
3. The Committee has received evidence that some news publications “have relied on unverifiable leaked reports or skewed research by think-tanks and individual consultants” when reporting on the effect of renewable energy policies on domestic energy bills, and that these news reports, “particularly the headlines, are highly selective in their use of facts and can often be open to accusations of bias.”25 What steps, if any, does your publication take to ensure that it complies with the Editors' Code of Practice and does not publish “inaccurate, misleading or distorted information” when reporting on these issues?
4. What impact does the media have on public perceptions of energy bills?
5. As outlined above, the Committee has heard from Carbon Brief that the Daily Mail and the Mail on Sunday have reused inaccurate figures on several occasions, even after they had printed corrections to those figures following successful complaints to the Press Complaints Commission that the use of those figures was inaccurate and misleading. How do you account for this reuse of inaccurate figures and what steps have you taken to ensure that the same figures will not be used in this way in future?
17 October 2012
Excerpt from Carbon Brief evidence regarding the use of inaccurate figures by the Daily Mail and The Mail on Sunday
12. [The] theme of "green taxes" came to prominence on 9th June 2011 with a front-page Daily Mail story26 and a series of follow-up articles stating that green policy measures were adding £200 to household energy bills. The Mail set out its views on the subject in an editorial on the same day:
13. "... huge uncertainties surround the science of climate change. Yet at immense cost, the Government is blindly committing Britain to the world's most ambitious targets for cutting carbon emissions. Already millions are feeling acute pain, through hidden levies which have contributed to the latest £200-a-year increases in our energy bills... the scandal is that these secret extras which add 15 to 20 per cent aren't even itemised on our gas and electricity bills."27
22 CE 23 para 36 (Carbon Brief) written evidence to the Committee, March 2012. 23 Ofgem Why are energy prices rising? (14/10/11) Factsheet 108; Committee on Climate Change (December 2011) p. 14 Household energy bills - impacts of meeting carbon budgets 24 CE 13 (Scottish Renewables) written evidence to the Committee, March 2012. 25 CE 13 (Scottish Renewables) written evidence to the Committee, March 2012. 26 The Da ily Mail, Hidden green tax in fuel bills, 9 Jun 2011 27 The Da ily Ma il, 'Inconvenient Truths' (editorial), 9th June 2011, p.14 14. This Daily Mail piece initiated an upturn in coverage of this area by the Mail, which was gradually picked up by other parts of the press. The framing and figures the Mail adopted were repeated by other newspapers. Headlines at the time included: "Green taxes make up 20 percent of household energy bills, campaigners warn" (Daily Telegraph)28, "Industry begins to count the true cost of ’climate change’" (Sunday Telegraph)29, "Families hit by £200 green tax in energy bills" (Daily Express).
15. This initial claim that ‘green taxes’ made up between 15 and 20 percent of an average household's combined annual gas and electricity bill (from £154 to £206 – often abbreviated to £200) was sourced to the thinktank the Global Warming Policy Foundation (GWPF) 30. At the time Ofgem's equivalent view was that "environmental costs" contributed £80 or around 8% to the average annual gas and electric bill 31, whilst DECC estimated that they accounted for 4% of the average bill32.
16. We have made a submission to the Leveson Inquiry in which we set down our interactions with the Mail Group and the PCC on this issue in some detail. 33 To summarise, we complained to the PCC that the £200 figure was inaccurate and misleading. The Mail initially contested the complaint, citing figures from BERR featured in a 2008 report by the thinktank Civitas.34 These figures did not substantiate the claim, as they referred to electricity rather than energy, the high end figure applied to non-domestic bills, and most relevantly the figures had been updated by newer analysis from BERR's replacement DECC.
17. We pointed this out, and the Mail printed a correction to their coverage on 7th September 2011. 35 However, shortly afterwards, the Mail on S unday re-used the original £200 figure in two different editorials. After we complained again, the Mail on Sunday printed a correction to both of these claims on 14th November 2011. Meanwhile, the Daily Mail had inaccurately claimed in two different editorials that green energy measures were currently adding £300 to bills. We made a third complaint and the Daily Mail printed a third correction on 19th December 2011. Despite three corrections from the Mail group on this issue, the Daily Mail subsequently re-used the inaccurate £200 figure in a Money Mail column in January36.
18. In making the case that green energy measures represent a significant and rising proportion of energy bills, the Mail produced other coverage which was confused at best, and in some cases deliberating misleading:
19. The Mail wrote a front-page headline article claiming that energy bills are “set to rise by around £1,000 a year - to £2,000” as a result of green policies, based on research by the bank Unicredit. This research was not publicly available. When we obtained a
28 The Telegraph, Green taxes make up 20 per cent of household energy bills, campaigners warn, 9 Jun 2011 29 The Telegraph, Industry begins to count the true cost of ‘climate change’, 11 Jun 2011 30 The GW PF , The Hidden Green Taxes in UK Fuel Bills, 8 Jun 2011 31 Ofgem, Updated Household bills explained, 18 Jan 2011 32 DECC, Estimated impacts of energy and climate change policies on energy prices and bills, Nov 2011 33 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Sub mission-by-Carbon-Brief.pdf 34 Civitas, British energy policy and the threat to manufacturing industry, April 2010 35 Carbon Brief, Daily Mail prints correction over GWPF green tax claims, 7 Sep 2011 36 The Da ily Mail, Reveal this ‘green tax’ on fuel bills, 14 Jan, 2012 copy, the figure was cited just once, in a section which had been quoted in a blog by the FT some months before 37. It seems likely that the Mail had not seen the report. The report did not detail how the figure had been calculated, or specify how much of the projected cost increase would be due to green policies.
20. In covering research which concluded rising energy bills were the result of both increased wholesale gas prices and green policies, the Mail omitted the findings about gas prices and focused only on green policies 38. The Mail’s headline “Green taxes could force one in four into fuel poverty” misrepresented the report’s findings which were that rising gas prices would account for a significant proportion of any rise in bills.
21. In discussing a report by the Climate Change Committee, the Mail’s headline was “Electricity bills to rocket by 25% because of 'green' targets, says Government”. 39 This 25% figure was from an annex of the report, and applied only to the one in ten “non-typical” households which use electric heating and which would be disproportionately impacted. This was not mentioned in the article 40;
22. Two months after the Mail covered DECC’s figures on energy bills on the front page 41, they ran another story using the same figures. The headline: “Official: Green taxes add 15% to your bills” inflated DECC's estimate of green costs from 7% to 15%, by conflating energy bills with electricity prices.
23. According to an article in ENDS, the Mail “put on the war paint” to "campaign" against green taxes during this period42. Over the nine months, the Mail group printed three separate corrections to its coverage of energy bills following PCC complaints which we made. This did not prevent them from repeating the inaccuracies in question, but these three corrections demonstrate that the Mail's campaign was launched on the basis of inaccurate figures.
24. Coverage by any national newspaper, particularly of this volume, is a significant part of the public debate. The Daily Mail is widely read and it seems reasonable to conclude that this extensive coverage has not improved public understanding of this issue. In the wake of and presumably inspired by the Mail's coverage, other media organisations started to focus on the effect of green policies on energy bills. The Mail’s campaign was also seen to have a political impact after George Osborne referenced the impact of green measures on bills in his conference speech.43
37 Carbon Brief, A thousand pounds on energy bills due to green policies?, 20 July 2011 38 Carbon Brief, Mail story on energy price rises ignores the role of spiralling wholesale fuel costs, 12 Oct 2011 39 The Da ily Mail, Electricity bills to rock et by 25% because of ‘green’ targets, says Government, 15 Dec 2011 40 Carbon Brief, Analysis of ‘non-typical households’ used to support misleading reporting of energy bills, 15 Dec 2011 41 The Da ily Mail, Green ‘tax’ to rise every year, 24 Nov 2011 42 ENDS Report blogs, Lord Lawson and the Daily Mail gang up on green energy taxes, 26 Jul 2011 43 See for example The Guardian, Ho w to solve ‘green growth denial in one stroke’. 27 October 2011 (CE 36h)
Letter to the Chair from Alex Bannister, Group Managing Editor at Associated Newspapers, on behalf of the Daily Mail and The Mail on Sunday
Thank you for your letter dated 17 October 2012 and for providing Associated Newspapers Limited ("ANL") with the opportunity to respond to the various concerns raised in it. Responses to your various questions are set out below:
Questions 1 - 3
These questions are broadly related and are addressed collectively for convenience. We understand the Committee to be asking for ANL's response to claims that, in relation to the cost to consumers of public investment in renewable energy:
• the media "tends to favour and promote explanations or projections which fit with the ir editorial line"; • the message that the rising wholesale price of gas is the main driver pushing up consumer energy bills has failed to reach some sections of the UK media; and • news publications are "highly selective in their use of facts and can often be open to accusations o f b ias ", perhaps even in breach of the Editors' Code of Practice (the "PCC Code").
These questions are somewhat abstract and it is difficult to respond to them in any detail; however there are a number of general points that ANL would like to make : a) ANL's titles go to great lengths to write about important matters such as these in a way whic h is informative, accessible and engaging. They need to do so in order to interest me mber s of the public in the {often complex) subject matter and encourage public debate on what are very important issues. In this regard, we refer to the evidence given by F iona Fox, chief executive of the Science Media Centre (o f which ANL is a funder), to the Leveson Inquiry:
"The science, health and environment journalists who write for the tabloids and on newspapers are brilliant. They are genius. Every single day they communicate very complicated and very important science to a mass audience ... Much of the coverage is accurate and balanced and the scientific community owes a huge debt to the skill and dedication of the excellent specialist science, health and environment journalists employed by every national newspaper. {24 January 2012) b) ANL's journalists make every effort to publish accurate reports on these matters, as they do in relation to all the articles that are published in ANL's titles. This is both because of the importance that ANL places on compliance with the PCC Code {for example, such compliance is a term o f journalists' contracts) and because ANL titles strive to publish accurate reports to maintain their readers' trust. c) It is true that, as in relation to articles on all subjects, mistakes are occasionally made. This is hardly surprising given the quantity of material published every day, the varied and often complex nature of the issues addressed and the time pressures involved. However, the Committee should be wary of reading too much into these occasional errors; particularly where they are highlighted by pressure groups with their own interests to pursue. The fac t is that these mistakes are the exception rather than the rule. d) The accusation that ANL is merely pursuing an 'editorial line' displays a misunderstanding of how ANL and its titles operate. ANL operates numerous and varied titles (each with their own entirely independent editorial teams) which themselves operate in different parts of the UK and, in the case of Mail Online, globally and employ an immensely diverse range of journalists. The primary purpose of these titles is to produce accurate reports of issues that are of concern to their readers. ANL's titles also employ columnists who express their own views on the issues of the day. This may be uncomfortable for certain groups who would rather certain issues went unchallenged; however it is important that these reports are produced and these views can be expressed. The debate on green taxes in particular is an on-going one within the pages of ANL's titles and within the media more generally. e) There is significant scope for honest disagreement around energy costs and how they should be quantified and/or allocated between different sectors and it is important that competing arguments and opinions are expressed on the matter in order for there to be a proper, informed public debate about these issues.
Question 4
ANL is not in a position to ascertain what impact the media has on public perception of energy bills. We can only comment on what ANL's titles hope to achieve through their reporting and that is to report in an accurate, accessible and engaging way in order to encourage public debate on these important issues (see the responses regarding questions 1-3 above).
Question 5
The Committee has asked for ANL's response to various claims made by Carbon Brief about the Daily Mail and the Mail on Sunday's "use of inaccurate figures " regarding the impact of green policy measures on household energy bills. As we understand them, Carbon Brief's claims are as follows: a) Inaccurate figures were reused in the Daily Mail and the Mail on S unday on several occasions (namely that green energy measures were accounting for up to £200 of annual household energy bills), even after they had printed corrections to those figures following successful complaints to the Press Complaints Commission. Carbon Brief appears to be alleging ANL's coverage in this regard was deliberately misleading.
Carbon Brief's complaint is based on an assumption that the Daily Mail and the Mail on Sunday knew the £200 figure was inaccurate prior to publication. This is incorrect.
The Daily Mail used this figure on 9 June 2011 having calculated it using information from a 2008 report by the think-tank Civitas and figures provided by the DECC. Similar figures had been used previously in articles published in the Daily Mail without complaint (see, for example, an article dated 28 September 2010 enclosed as attachment 1 (not printed) ). At the time of publication, the Daily Mail believed this figure to be accurate. When Carbon Brief subsequently explained the inaccurac ies in the calculations made by the paper, the Daily Mail agreed to publish a correction (which it did on 7 September 2011). For its part, the Mail on Sunday based its reports on 18 September 2011 and 18 October 2011 on figures it had sourced entirely independently from the Daily Mail (in this case from information provided by government and energy industry sources) and the editorial team were not aware that the previous use of a similar figure by the Daily Mail had led to a correction. This is unsurprising given that the newspapers have entirely separate editorial tea ms and used different sources fo r the figures used. When the Mail on Sunday received Mr Hunt's complaint to the PCC, it agreed to publish a correction.
In short, at the time of publication, both newspapers believed (and had reasonable grounds to believe) the figures they were using were accurate. It is also worth noting that at least one of the articles Mr Hunt has complained of included a link to an online forum where comment pieces from a number of competing sources were published (including sources citing the competing OFGEM figures which Carbon Brief considers to be authoritative): http://www.fmwf.com/extra/blogs/lisa-buckinghams-blog/2012/01/reveal-this-green-tax-on- fuelbills/ b) An article appeared in the Daily Mail on 13 July 2011 in which it was claimed that energy bills were set to rise by £1,000 as a result of green policies. This report was based on research by the bank Unicredit which was not publicly available. Carbon Brief claim that "It seems likely that the Mail had not seen the Unicredit report. The report did not detail how the figure had been calculated, or specify how much of the projected costs increase would be due to green policies."
The relevant article can be found here: http://www.dailyma il.co.uk/news/article- 2014068/ChrisHuhne-Families-face-1 k-green-energy.htmI
The article stated that "Families face punishing increases in energy bills of up to £1,000 a year to fund a switch to green energy and build new nuclear power stations." This figure was attributed in the article to research by Unicredit Bank. As the Carbon Brief submission states, this figure had appeared in the Financial Times ("the FT") six months before the article in the Daily Mail (see: http:Uftalphaville.ft.com/2011/01/11/454686/uk-fuel-poverty-and-the- security-of-supply/). The journalist spoke to Unicredit who confirmed that the passages cited by the FT were accurate. The relevant passage from this report for the purposes of the Daily Mail article stated as follows:
"In our view, the cost pressures from environmental and social programs and rising network charges will mean that household bills will continue to increase in real terms for many years to come. This excludes the impact of commodity price movements which could increase tariffs even further. We believe that these increases will make it harder for supply companies to pass on their costs to customers and will negatively impact the margins they can achieve going forward. We also believe that this will be exacerbated by the issue of affordability - with customers likely having to spend more of their disposable income on their energy bill in the future. According to our analysis, a typical UK energy bill could rise from the current level of GBP 1000 per year to over GBP 2000 per year by 2015. As investment occurs, bills could double every five years until 2020, in our view.”
It seemed clear, therefore, that Unicredit had taken the view that, "exclud[ing] the impact of commodity price movements" consumers' bills were likely to rise sharply as a result of "environmental and social programmes and rising network charges". The journalist's understanding was that all of these charges relate to efforts to reduce carbon emissions, including the switch to green energy, building new nuclear power stations and paying to insulate homes by various means.
The Unicredit report was compiled by its analyst Scott Phillips, who previously worked as a financial modeller for the energy regulator Ofgem. Given his background and expertise it is understandable that the journalist considered his estimates and calculations to be noteworthy.
The article also pointed out that "There is a fierce dispute between the Government, green campaigners, academics and industry analysts over the true cost of the programme" and included a quote fro m Dr Robert Gross, director of the Centre fo r Energy Policy and Technology at Imperial College, challenging the Unicredit estimates. On top of this, the article quoted a range of competing estimates for the impact on bills. These included the claim by the DECC that the impact on bills would be limited to £160 a year by 2030 and an estimate from Ofgem that bills would rise by up to 52%, which would equate to £600 a year by 2020.
In short, the journalist spoke to the bank who confirmed the accuracy of the relevant passages. As well as citing the Unicredit estimates, the journalist also referred to the competing Ofgem and DECC figures and made it clear that there was a significant debate going on as to the impact of green energy measures on consumer's bills. The article was well researched, based on a variety of reliable sources and balanced. It is difficult to see how it can be criticised in any way. c) An article was published in the Daily Mail on 12 October 2011 covering research which concluded that rising energy bills were the result of both increased wholesale gas prices and green policies. The article however omitted the findings about gas prices and focused only on green policies, misrepresenting the report's findings whic h were that rising gas prices would account for a significant proportion of any rise in bills.
The article concerned can be found here: http://www.dailymail.co.uk/news/article- 2048122/Green-taxes-fo rce-fuel-poverty.html
This article was based on research by Deloitte which stressed the impact of green taxes as being the major factor in driving up energy bills. Martin Brough, who wrote the report said that "In our view, mitigating bill increases would involve abandoning green targets or implementing a radical refinancing of the industry". Therefore, while the Deloitte report mentioned increases in gas prices as part of the explanation as to why energy bills were rising, a solution proposed to tackle these r is es was the abandoning o f a number of green policies.
It is a lso wor th noting that the article cites the contrary views of Dr Robert who "insists that families will be better off by switching from fossil fuels" . He is also quoted as saying that "Cutting support for renewables would slow down the UK's progress in reducing dependence on imported fossil fuels". Therefore, this article was based on reliable resources (in the form of a report by Deloitte) and was balanced by the inclusion of competing views. Again, it is difficult to see how it can be criticised. d) An article was published in the Daily Mail on 15 December 2011 in whic h it was said that electricity bills were to rocket by 25% because of 'green targets'. Carbon Brief assert that "this 25% figure was from an annex of the report, and applied only to the one in ten "non- typical" households which use electric heating and which would be disproportionately impacted. This was not mentioned in the article".
The article involved can be found here: http://www.dailymail.co.uk/news/article- 2074299/Eiectricity-bills-rocket-25-green-targets-say-Government.html
This was based on a report by the Committee on Climate Change ("CCC") in which it was concluded that the costs of low carbon policies would add 3 pence to the current 12.6 pence unit price of a kilowatt hour of electricity over the next decade (see p.17 of the report: http://www.theccc.org.uk/reports/household-energy-bills). This amounts to a 23.8% increase in electricity prices (this is where the 25% figure cited in the article was taken from).
Contrary to what Carbon Brief suggests, the article mentions in a number of places that those consumers whose homes are heated by electricity would see the biggest increases to their bills.
For example, the article states that "The impact on families will vary according to consumption, but the report found that those whose homes are heated by electricity could see their annual bills rise by more than £400." It also states that "The CCC's report suggests that people whose homes are heated by electricity will see their average bills rise from about £1,500 to £2,100 in 2020".
Furthermore, the article says that the report's "best estimate was that green measures would add only £110 to the typical annual fuel bill by 2020 ... [but] the switch to green energy will have a greater impact on electricity prices than gas prices."
In summary, not only was the 25% figure cited in the article accurately taken from the CCC report, but it was made very clear in the article that households which use electric heating would be disproportionately impacted. Therefore, it is difficult to see any basis for Carbon Brie f's complaint. e) An article was published in the Daily Mail on 17 February 2012 in whic h it was claimed that "Green taxes add 15% to your bills". Carbon Brief claim that the 15% figure inflated DECC's estimates of green costs from 7% to 15%, by conflating energy bills with electricity prices.
A copy of the relevant article can be found here: http://www.dailymail.co.uk/news/article- 2102848/Green-taxes-add-15-electricity-prices-Go ve r nme nt-f inally-admits-families-pay- meetemissions-targets.html
As you can see, the article makes it very clear that the 15% figure relates to electricity prices, not bills. For example, the very first line of the article says that "Electricity prices are 15 per cent more expensive that they should be because of green policies". There is also a graphic whic h makes this very clear. Carbon Br ie f's co mp laint is therefore unfounded.
It is true that the hard copy of the article included the headline "Official: Green taxes add 15% to your bills" (copy enclosed as attachment 2 (not printed)). However, this headline was not written by the journalist (as you are probably aware, reporters do not write headlines for their stories) and it appears that the word "b il ls " was used rather than "electric ity prices" purely as shorthand because o f the limited space available for the headline. Given the very clear graphic in the article and the fact that the first two words state "ELEC TRICITY prices", it is difficult to see how any readers can have been misled. In any event, the headline for the online vers io n o f the article was amended to read "e lectricity prices" rather than "b il ls".
We trust the explanations set out above dea l with any concerns you may have had regarding how ANL's titles report these matters, and show that Carbon Brie f's complaints are unfounded. Never the less, should you require any further information on anything that has been said, please let us know.
7 December 2012