Energy bills: George Eustice grilled on 'off-peak discounts'
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The new forecast from consultants BFY comes after Russia slashed its gas deliveries to Europe in a move which sent wholesale gas prices skyrocketing. It means a typical household may have to fork out an extra £500 just to pay off the energy bills in January alone.
Industry regulator Ofgem had earlier warned the energy price cap (maximum annual tariff) was set to reach around £3,200 by October.
But BFY’s forecast says this will reach fresh highs of £3,420 that month, only to surge to £3,850 in January.
Mike Foster, head of the Energy and Utilities Alliance, said this will “fill British consumers with horror”.
He told Express.co.uk in an exclusive interview: “These stories are shocking. They will fill British consumes with horror as we approach the autumn and people start to think about adjusting for the heating season.
“We will know shortly what the price cap will be from October and that is expected to go over £3,000 and clearly as we see no end in sight to Russian aggression and the impact on global gas prices.
“The worst news that you hear seems to become the norm. Already we know people are rationing their heat.”
And Mr Foster called on the Government to do more given that the country has been grappling with rising bills for almost a year.
The industry insider told Express.co.uk: “We knew from last winter that people were choosing not to keep their homes warm because they could not afford to pay the bill for doing so.
“We are the fifth richest country in the world and that is just shocking. The health impacts of living in cold homes are well known and it is ordinary hard working families that are suffering because frankly not enough is being done to protect them from this global energy price shock.”
The comes after gas prices soared to record highs of 530p per therm for the coming winter on Wednesday morning following Russian President Vladimir Putin’s gas cut.
Gas flows through the major Nord Stream 1 pipeline are now just at 20 percent of normal capacity, a move which the Kremlin-controlled energy giant Gazprom has blamed on maintenance issues.
While the UK only receives around four percent of its gas supplies from Russia, the integrated nature of the gas market has meant Britain has felt the impacts of Moscow’s supply squeezes.
This has piled the pressure on the future Prime Minister to come up with a long-term plan to shield UK consumers from Putin’s gas games.
But George Bridges, chair of the Lords economic affairs committee, has warned there is currently no plan for reliable or affordable energy to help the country to survive future price shocks.
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In an opinion piece for the Telegraph, he wrote that the Russian cuts have come as a “wake-up call” that expose the vulnerabilities in the country’s energy security.
Former Chancellor Rishi Sunak, who is vying to become the next Prime Minister, has mentioned in leadership debates that the country does in fact need a long-term plan to cope with supply shocks.
He said during the debate which aired on BBC One on Monday night: “I think there is a couple of things we can do (in the long term). The first is to help people with energy efficiency…We know that there are millions of homes that needs better insulation. If we can do that then we can help people save £300 off their energy bills.
“And we need more homegrown energy here at home because if we have more affordable sources of British energy, this is how we will solve the problem.”
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