The chart

The chart compares increases in the retail cost of gas and electricity against increases in the State Pension, Average Earnings and the Minimum Wage from 2008-2015. It suggests that energy is less affordable than it was.

Data for electricity and gas prices was obtained from DECC Quartlerly Electicity Prices

Minimum wage data was from Trading Economics which uses Department of Work and Pensions (DWP) data. State Pension rates were from Historical Rates of Social Security Benefits up to 2012. For 2013, 2014 and 2015.

There does not seem to be a convenient source of average earnings. From 2011 to 2015 they are available from ONS Annual survey of Hours and Earnings. For earlier years I had to Google for “annual survey of hours and earnings YYYY” because the surveys have been archived. Note that the methodology changed from 2010 to 2011 with the new method estimating earning about 0.5% lower.One cannot really go back before 2008. I extracted the weekly wage manually from each report.

Here is a table of the chart data:
Year Minimum Wage
£/hr 		State Pension
£/week 		Average Earnings
£/week 		Electricity
p/kWh 		Gas price
p/kWh
2008 5.73 90.7 479 12.71 3.795
2009 5.8 95.25 489 13.695 4.24
2010 5.93 97.65 499 13.09 4.005
2011 6.08 102.15 498 14.14 4.685
2012 6.19 107.45 506 15.35 5.15
2013 6.31 110.15 517 16.355 5.825
2014 6.5 113.1 518 17.56 7.11
2015 6.7 115.95 528 17.335 6.57
and here are the same values indexed to 2008
Year Minimum
Wage 		State
Pension 		Average
Earnings 		Electricity
Price 		Gas
Price 		Average
Price
2008 100 100 100 100 100 100
2009 101 105 102 108 112 110
2010 103 108 104 103 106 104.5
2011 106 113 104 111 123 117
2012 108 118 106 121 136 128.5
2013 110 121 108 129 153 141
2014 113 125 108 138 187 162.5
2015 117 128 110 136 173 154.5

Comments

I made this chart because of a footnote in DECC Sub-national electricity and gas consumption statistics 2015. This states (p. 11) that “mean domestic electricity consumption” reduced by 14.1% between 2005 and 2014. It says that this is partly because of more efficient domestic devices and better insulated homes but that the cost of electricity may be a factor. Since London (rich) reduced usage by 10.4% and West Midlands (poor) reduced by 17.9% this seems likely.

Tucked away in a footnote we find that electricity prices have increased by 81.4% between 2005 and 2013 in nominal terms and 50% in “real” terms.

The chart does not go back to 2005 because the way the statistics were compiled changed in 2008 so earlier figures are not strictly comparable (they are EU statistics covering all EU countries).

The chart also shows the average indexed price of electricity and gas (simply sum and divide by 2). The interesting thing is that the gas price has gone up a lot more than the electrticity price.

As the table shows the electricity price has risen by 36% since 2008 but the gas price in 2014 was up by 87%.