Nine million households face fuel poverty this winter after energy bill hike
The number of people in fuel poverty will nearly double this winter, warned National Energy Action, following Ofgem’s decision to hike the energy price cap 80 per cent from October.
The price cap is now set to rise from £1,971 per year to £3,549 per year on October 1.
The charity predicts nearly nine million people will be dragged into fuel poverty this October- rising from 4.3m to 8.9m in a 12 month window.
This is defined by a household spending over 10 per cent of their income on their energy bills.
Cornwall Insight forecasts the cap will rise higher and higher over the coming months, peaking at an eye-watering £6,616 per year.
Adam Scorer, National Energy Action (NEA) chief executive, feared that a warm home this winter will be a “pipedream for millions” amid ultra-high energy bills .
He said: “We know who gets hit hardest, what impact it will have and how to get money into the pockets or off the bills of the most vulnerable. Without bold action to support the most vulnerable and those on the lowest incomes, this will effectively prise their fingers from the cliff edge and push them over the precipice.”
The charity has called on the Government to immediately upgrade the household support package announced in May.
The £15bn package, unveiled by former Chancellor Rishi Sunak, was based on earlier forecasts that the cap would rise to £2,800 per year – offering £400 discounts to households.
However, wholesale costs have spiked with Russia squeezing supplies into Europe, alongside supply shortages across key producing nations.
Scorer said: “Households need money in their pockets to weather this storm or we are going to see millions in dangerously cold homes, suffering in misery with unimaginable debt and ill health. Even with a mild winter, millions are facing a big freeze. Action is needed now to prevent the bleakest of winters.”
The next Prime Minister is expected to be announced on September 5 – with Foreign Secretary Liz Truss expected to win the Tory leadership contest ahead of Sunak.
However, there have been calls for support to be announced before then, with Utilita Energy boss Bill Bullen last week urging the Government to “get ahead” of the problem.
He told City A.M.: “There’s a clear risk of this spilling over into unrest.”
Meanwhile, Ofgem chief Jonathan Brearley has called on the Government to match the scale of the crisis with its response to the latest price cap hike.
He said: “We are working with ministers, consumer groups and industry on a set of options for the incoming Prime Minister that will require urgent action. The response will need to match the scale of the crisis we have before us. With the right support in place and with regulator, government, industry and consumers working together, we can find a way through this.”