§ Mr. Lathamasked the Secretary of State for Energy (1) whether he will make it his policy not to permit an 638W increase in electricity prices between May 1982 and May 1983 which is in excess of the increase in the retail prices index;
(2) to what causes he attributes the fact that electricity prices increased by 10 per cent. between May 1981 and May 1982 at a time when the retail price index rose by 9.5 per cent. and coal prices by 8 per cent.;
(3) to what causes he attributes the fact that electricity prices increased by 22 per cent. between July 1980 and July 1981 at a time when the retail price index rose by 10.9 per cent. and coal prices by 9 per cent.
§ Mr. Lawson[pursuant to the reply, 28 July 1982, c. 545]: Price comparisons between one month and another can be distorted by the timing of tariff revisions. For example, whereas domestic electricity prices rose by 22 per cent. between July 1980 and July 1981, they rose by only 11 per cent. between August 1980 and August 1981.
Taking the period from 1980–81 to 1982–83 as a whole, average electricity prices this financial year are expected to be about 26 per cent. higher than they were two years previously. The industry expects that over the same period the rise in the price of fossil fuel will be about 24 per cent., and that unit operating costs apart from fuel will increase by about 26 per cent. Part of the increase in unit operating costs is due to the decline in sales.
I do not envisage any further tariff increases this financial year. In fixing future tariffs the industry will need to continue to take account of movements in its own costs.