UK households could see their energy bills rise by as much as £150, or 13% this winter – in what would rank as the biggest increase in a decade.
Ofgem is expected to announce an increase to the energy price cap from 1st October, in response to an “unprecedented” global gas market surge. However, fuel poverty campaigners have warned that around 400,000 households could be pushed into fuel poverty as a result.
Currently, it’s estimated that around 3 million UK homes are unable to afford their energy bills. Campaigners have warned that for every one percentage point rise in annual energy bills, an additional 40,000 homes could fall into fuel poverty.
Calculations by the End Fuel Poverty Coalition estimate that the price rise will force an additional 392,000 households into fuel poverty within the coming months.
Simon Francis, co-ordinator of the End Fuel Poverty Coalition, said:
“While people’s attention is diverted by the rush out of lockdown, the reality is that the countdown to winter is on and it is a race against time. Any price rise – however small – will mean the choice between heating or eating becomes even starker later this year.
If that wasn’t bad enough, fuel poverty can make respiratory illnesses worse – meaning conditions such as Covid may be exacerbated by living in cold damp homes.
Short-term energy saving measures and shopping around for cheaper energy can help reduce bills, but the scale of the problem faced by people this year is huge and any increases during the pandemic and the recovery should be avoided.
We’d urge Ofgem and policy makers to think again about the price cap rise, or the Government to step in and provide emergency financial support to those who suffer due to the decision.”
The cap, which came into force in January 2019, was introduced to protect customers from upsurges to standard variable and default energy tariffs.
Households on these tariffs could be saving hundreds by shopping around for a better energy deal, with over 100 cheaper tariffs available on the market.