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) [8] , "Industry begins to count the true cost of ’climate change’" (Sunday Telegraph) [9] , "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) [10] . At the time Ofgem's equivalent view was that "environmental costs" contributed £80 or around 8% to the average annual gas and electric bill [11] , whilst DECC estimated that they accounted for 4% of the average bill [12] .

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. [13] 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. [14] 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. [15] However, shortly afterwards, the Mail on Sunday 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 January [16] .

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 copy, the figure was cited just once, in a section which had been quoted in a blog by the FT some months before [17] . 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 [18] . 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". [19] 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 [20] ;

22. Two months after the Mail covered DECC’s figures on energy bills on the front page [21] , 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 period [22] . 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. [23]

25. The subsequent prominence of the green tax frame suggests to us that the Mail's coverage has been influential. There has been plenty of accurate coverage of green costs on energy bills, but there are significant examples where the same errors or similar have been repeated, where coverage would be extremely confusing for a lay reader, or where coverage does not give an accurate picture of the factors affecting actual energy costs for consumers. We have not addressed all of these in detail but have picked out a few examples below.

26. A front-page Sunday Telegraph article suggested energy bills would rise by £300 by 2020, based on a leaked government memo. The story appears to have confused energy bills with electricity prices. [24]

27. An edition of the BBC's Panorama asked "What's fuelling your energy bill?" Their answer can be paraphrased as "climate policies". The programme didn't mention that most of the recent rise in energy bills is due to rises in the price of wholesale gas. [25] The BBC subsequently published a clarification [26] which noted "We accept that it would have been helpful to our audience had this point been made more clear in the film and the website materials that accompanied it."

28. The CEO of British Gas cited figures for the effect of green policies on "power" bills (15% on an electricity bill, according to Ofgem), rather than energy bills (7% by the same source). This provided a headline in the sun blaming green taxes for price rises, despite gas accounting for 54% of the cost of an average British Gas energy bill. [27]

29. In November last year the Sunday Times printed a story covering an upcoming report from KPMG which found that "each member of the population almost £550" if "expensive wind energy plans" were scrapped in favour of nuclear and gas-fired plant. [28] KPMG never released the report, citing concerns that it was "ripe for misinterpretation" by the media looking for a simple headline. [29]

30. There are also cases where the article is technically accurate but the headline creates a somewhat misleading impression. These include for example an FT headline: "Household energy bills to rise by £100 a year" (this means an increase in annual payments of £100, not an annual rise of £100), or a Telegraph headline: "Greener energy will cost £4,600 a year" (this fails to mention that the option which did not use greener energy was more expensive).

The impact of the media debate on public perceptions

31. Over the last nine months there have been a significant number of articles in the UK press about the impact of green policy measures on domestic energy bills [30] , including a series of prominent and misleading pieces.

32. Ofgem provide a breakdown of the costs that make up an average dual-fuel energy bill. Ofgem are independent of government, tasked with protecting consumers, and receive the data they use to calculate breakdowns of bills directly from the energy companies. Perhaps for these reasons their assessment is generally regarded as reliable. DECC also produce an assessments of costs which comes to similar conclusions to Ofgem.

33. However, these kind of analyses appear to be produced for researchers engaged with the energy field, not consumers. Consumers also receive very little information about how their bills break down from utility companies. Scottish and Southern currently puts limited information about the breakdown of costs to their customers on an energy bill, but they are the only one of the six biggest energy companies that do so [31] .

34. In our view, consumers are more likely to get information about the breakdown of costs in energy bills from the media than any other source. It seems likely that the inaccuracies in media coverage have had a negative impact on consumer awareness.

To what extent are consumers aware of the future projected levels of energy prices and bills and the drivers behind this?

35. Future energy prices for consumers will be determined by many different factors, including energy policy at the national and European level, consumption and production of fuel sources in different parts of the world, and the growth of new fuel sources like solar, wind power and shale gas. It's not only complicated to understand, it's difficult for experts to get it right in the first place.

36. The media tends to favour and promote explanations or projections which fit with their editorial line. Two significant unknowns are what is going to happen to gas prices over the next decade, and whether energy efficiency policy measures will be effective in reducing overall consumption and therefore bills. If articles do not convey the uncertainty in projections about future energy issues, this leads to coverage which suggests radically different conclusions.

37. Advocates against renewable energy tend to argue that shale gas will bring gas prices down, renewable energy costs will stay high [32] , and energy efficiency measures will be ineffective. On the other hand, supporters of renewable energy have tended to assume [33] that over the next decade gas prices will go up - making renewables relatively less expensive - and energy efficiency policies are going to be effective [34] - bringing down bills by reducing energy consumption.

38. For example, analysis by the renewable energy company RES, reported in the Telegraph, argued that dependence on imported gas could cost each household "more than £1,200". This rested on the assumption that gas prices would rise over the next decade at the same rate as they have over the last ten years. [35] Friends of the Earth undertook a similar calculation based on the same assumption, which was highlighted in the Daily Mail. [36] Was this reasonable? There are grounds for caution - as UK gas prices have risen very significantly over the last decade, extrapolating the trend forward leads to high-end estimate.

39. Official bodies produce analysis on this subject. Ofgem [37] , DECC [38] and the UK Climate Change Committee [39] have all produced reports outlining future predicted trends in energy prices. We have noted that these are increasingly presented in a way that is intended to be accessible for journalists and the lay reader - presumably in response to inaccurate media coverage.

40. But some of DECC's other statements may well have added to consumer confusion. For example, Chris Huhne predicted during his annual energy statement that energy bills in 2020 would be "7% lower than they otherwise would be" as a result of Government policies. This obscures the fact that DECC projects domestic energy bills will rise 3% by 2020, and that energy bills will go up by 2020 for two thirds of government households, as a result of Government policy. [40]

Is greater consumer education needed and if so, who should take responsibility for this, who should deliver it and how should it be delivered

41. As we have outlined in the previous question, both DECC and Ofgem have responded to a degree in this debate - with varying levels of swiftness - and it is good to see materials produced that specifically engage with the kinds of questions that are being posed in the press.

42. DECC has produced the online ‘energy calculator’ [41] and is also now publishing blog posts which comment on inaccurate interpertations of their analysis. [42] This is helpful in our view as it allows DECC's analysis to be debated and scrutinised, and places something of a restraint upon the most inaccurate reporting.

43. The figures produced by Ofgem seem to be well respected and the closest the energy bills debate has to an agreed factbase. Ofgem however is not a public facing organisation and may not be well suited for the task of educating consumers.

44. We have three suggested recommendations: that the energy regulator or a similar ‘neutral arbiter’ be given the job of communicating these issues to consumers rather than just to Government and industry and enabled to do so; that energy companies be encouraged or required to communicate more clearly about how their bills break down; and that care it taken to ensure changes to the regulation of the press currently being considered limit the promotion of inaccurate coverage of this topic.

March 2012