Electricity Prices - The long view

Creating a time series of electricity prices compiled from actual bills has been a back-burner project for a few years.  I recently found a copy "Brighton and the Electric Revolution - 1882-1982" in the public library which provided data points for 1887 and 1893 and this has facilitated a revision of an earlier post.

Brighton on the south coast of England was one of the first towns in the world to have a public electricity supply.  Initially this was provided by private companies, towards the end of the 19th century, generation and transmission was taken over by the town council and later nationalized in the early post war years and then privatized in the 1990s.

Inevitably, getting like-for-like data for an industry which has been subject to technical, commercial and political change is difficult and thus the data in the graphs below should be treated with caution.  The gaps are being filled in as I find old electricity bills or advertising material.

The first graph is is from 1887 to 2015 with a log scale for the price in 2011 money which makes it possible to show a range of prices from 5p - 500p per kwh

The second graph starts at 1900 and has a linear scale for unit prices:

In the late 19th century electricity at £5/kwh in current prices was a luxury product but as generating capacity and demand increased, the prices started to fall and the displacement of gas as a means of domestic lighting began to accelerate.  Our family's experience suggests that it was only after the first world war that working families started to wire their houses for electricity in large numbers.  Initially electricity was only used for lighting, but by the start of the second world war many homes had vacuum cleaners, electric irons, radios and electric fires and a few had TV sets.  Often someone had to be ill before and electric fire was turned on because of the cost.  In the period following the second world war, prices were generally stable and possibly "cheap".  With the rise in oil and gas prices early in the 21st century, the prices of electricity started to rise and become a matter of political and economic concern.

Energy price forecasts can be a career graveyard, but it looks as if electricity prices in the 21st century will be higher than they were in the second half of the 20th.  The published "strike price" for nuclear power project appears to be around 9p/kwh and that for offshore wind around 12p/kwh, the consumer will pay transmission and distribution costs on top of these figures.  Nuclear and wind are only part of the energy mix, but it is not expected that oil and gas prices will remain at their current relatively low levels for a prolonged period.