Energy bill horror as half of UK households face fuel poverty in ‘catastrophic winter’

UK 'terrified of not being able to pay their bills' says MP

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Industry regulator Ofgem is set to announce the October price cap (maximum annual tariff) on Friday, with forecasters expecting this to reach around £3,500. Up from the current level of £1,971, this staggering increase has prompted serious fears that half of UK households face fuel poverty unless the Government alleviates the pressures of the rising bills.

EDF has warned that, without support, a “catastrophic winter” is on the way.

The firm’s managing director for UK customers, Philippe Commaret, told the BBC: “When you look at the figures, without support from the Government, more than half of UK households will be likely to be on fuel poverty in January, which means they will have to spend more than 10 percent of their disposable income to pay for their energy bill.”

With the surge a reflection of the hike in global gas prices sparked by Russia’s war in Ukraine and Vladimir Putin’s gas cuts, there is little Westminster can do in terms of bringing energy costs down for companies.

But where it can step in is by providing immediate relief to households, which could involve discounts, a price cap freeze, or even a more radical approach such as nationalising energy.

And there is some help on the way, with a £400 discount on bills for all UK households set to come into effect in October.

Eight million low-income households will also receive an additional £650.

But for Mr Commaret, the support offered so far is “much too low”, and call for additional support including both short-term help and longer-term solutions.

The EDF boss added: “By way of context, I have to mention that we face, despite the support that the Government [has] already announced, a dramatic and catastrophic winter for our customers.”

But in the Conservative leadership contest, energy bills have been somewhat sidelined in favour of tax cut debates.

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Harry Gault, an executive at PR consultancy Pagefield, wrote: “It is striking then that, with Boris Johnson deferring action to his successor, the Conservative leadership contest is becoming increasingly divorced from reality.

“Both contenders, Liz Truss and Rishi Sunak, have placed the debate around tax at the centre of their pitch to Tory members, forgoing comprehensive strategies in response to increasing energy costs which are driving the cost of living situation in the UK.

“Instead, we have heard piecemeal announcements often made on the hoof.”

Foreign Secretary has pledged to cut taxes instead of offering “handouts” to help households cope with the cost of living crisis, instead funding public services through borrowing.

But former Chancellor Rishi Sunak has warned that this could worsen inflation, which is already tipped to reach 13 percent.

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But it has emerged that Ms Truss may “U-turn” on the pledge not to provide handouts as the cost of living crisis deepens, and may indeed to provide cash grants for vulnerable households.

It comes after Business Secretary Kwasi Kwarteng, who has been tipped to become Chancellor under Ms Truss’ leadership, stressed that “help is coming”.

Meanwhile, Ms Truss’ only concrete pledge on the energy crisis appears to be a temporary moratorium on the green energy levy which could slash bills by £160.

But as the price cap could reach a staggering £6,500 by April, according to some forecasts, scrapping the levy would only be a drop in the ocean for consumers facing eye-watering bills.

And after Labour leader Sir Keir Starmer floated a plan to freeze bills at just under £2,000, which would cost £30billion, he soared ahead in the polls.

The Liberal Democrats have called for a “double bill freeze” after claiming both Ms Truss and Mr Sunak are “in denial” over the energy price rises.

The party claims the plan could save families £2,000 in total.

It argues scrapping the energy price cap would save families around £1,400 a year, while freezing rail prices would save £600.

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