DECC’s analysis estimates that the benefits to the UK as a whole of measures to help avert climate change could outweigh the costs by more than 10 times. Where these measures lead to an international climate agreement consistent with delivering a 450 ppm stabilisation of GHG atmospheric concentrations, we estimate the total benefits at £241.9 billion. This compares with total costs of £20.6 billion. The Impact Assessment can be found at:
www.decc.gov.uk/en/content/cms/what_we_do/lc_uk/carbon_budgets/carbon_budgets.aspx
The Government are committed to ensuring that policies to avert climate change are cost-effective.
For household consumers, approximately 12 to 14 per cent. of current average electricity prices is attributable to measures to implement commitments to reduce carbon dioxide emissions (the Renewables Obligation, the EU Emissions Trading Scheme and the Carbon Emissions Reduction Target).
For household gas consumers, approximately 2 per cent. of the average gas price is attributable to the Carbon Emissions Reduction Target.
However the Carbon Emissions Reduction Target supports energy efficiency measures for households and so will deliver over time an overall saving on both gas and electricity bills greater than its total cost to consumers.
For medium industrial electricity consumers, approximately 20 per cent. of current average electricity bills is attributable to measures to implement commitments to reduce carbon dioxide emissions (the Renewables Obligation, EU ETS and the Climate Change Levy).
On gas, approximately 7 per cent. of current average prices for a medium industrial gas consumer is attributable to the Climate Change Levy.
Actual proportions for individual industrial consumers will vary from these estimated averages according to the considerable ranges of prices paid and of consumption sizes. Impacts will generally be lower for those companies which have entered into Climate Change Agreements. The revenue raised by the Climate Change Levy is recycled back to business, primarily through a 0.3 percentage point reduction in employers’ national insurance contributions.