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Cameron defends energy subsidies

The prime minister has defended energy subsidies, after SSE blamed them for price rises

Cameron has said green subsidies are a necessity

The energy company was the first of the big six to bump its prices, after it announced customers will be facing increases of 8.2% on their bills from November.

SSE’s Will Morris said: “We’ve done as much as we could to keep prices down, but the reality is that buying wholesale energy in global markets, delivering it to customers’ homes, and government-imposed levies collected through bills – endorsed by all the major parties – all cost more than they did last year.”

Subsidies not on bills ‘for longer than necessary’

Cameron, however, refuted the claims that subsidies were to blame for prices heading upwards this winter, and said there are other ways that they can be brought down in the long-term.

He said that tackling high wholesale gas prices can be done by improving competition between energy companies and pushing ahead with fracking.

Cameron then went on to defend the necessity of the subsidies in place, saying that they are an essential way to make sure the UK is providing a diverse and balanced range of energy options such as renewable technology and nuclear.

To achieve this “some of those subsidies have been necessary”, he said, adding that the subsidies would not be attached to consumers’ bills “for a moment longer than is necessary”.

Government is ‘under pressure’

The latest comments from Cameron come at a time when the government is under pressure from consumer groups and other parties to lower the prices people pay, with bills hitting record-high levels, and other large providers likely to increase what they charge this winter.

There has been much support, for example, for promises made by Labour leader Ed Miliband to freeze energy bills and try to challenge the power of the big six in the 20 months following the 2015 general election.

However, Cameron slammed the pledge as being nothing more than “a con”.

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