Energy bills to rise even higher as suppliers warn of ‘nationwide crisis’

The chief executive of Energy UK, Emma Pinchbeck, described the situation as a “nationwide crisis”

Grace Almond
Thursday 23 December 2021 01:55
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<p>EDF is raising its prices by 3.9 per cent but has warned of further increases</p>

EDF is raising its prices by 3.9 per cent but has warned of further increases

The new year could see further increases to energy bills, providers have warned.

Several providers including Good Energy, EDF and the trade body Energy UK, told the Financial Times that the government must intervene as a matter of urgency.

The warning comes as the cost of gas in wholesale markets rose by more than 500 per cent in less than a year.

The chief executive of Energy UK, Emma Pinchbeck, described the situation as a “nationwide crisis”.

Ms Pinchbeck told the Financial Times: “Other treasuries in Europe have already responded to the crisis, but in the UK, the energy sector is still asking if the chancellor knows that energy bills going up by over 50 per cent in the new year is a problem for ordinary people, businesses and the economy.”

Nigel Pocklington, chief executive of Good Energy – a small renewable energy company – told the newspaper the UK could experience a “national crisis”.

Mr Pocklington said recent increases in prices created “an extremely difficult operating environment for every business in the industry”.

EDF Energy urged the government to act swiftly.

Household energy bills could jump to record £2,000 a year. The price cap – which eases the burden for families – may have to be increased by more than 50 per cent in April, experts are warning, because of unprecedented wholesale costs.

The cap is currently reviewed and set every six months. A rise in bills by 12 per cent was authorised from October onwards, with a typical household facing costs of £1,277 on a standard tariff.

A further announcement is due in February for a second rise in April, with an increase already inevitable to pay for the collapse of more than two dozen UK energy companies in recent months.

More than two dozen energy suppliers have gone bust since the start of September, leading to thousands of job losses, and leaving millions of homes in limbo as they wait to be set up with a new supplier.

It’s expected that the cost of the collapse of these energy firms will be recouped from energy bills.

The industry regulator, Ofgem, has proposed a series of solutions including reviewing the price cap every three months or replacing it with a six-month fixed tariff.

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