Energy bills are set to climb even higher next year as suppliers warn of a “nationwide crisis” and urge the government to intervene after gas costs soar
- Leading bodies in the energy sector have called for urgent intervention in crises
- The cost of gas in the wholesale markets has increased more than 500% in less than 12 months
- Experts say the UK is lagging behind other European countries
The electricity bills will soar even further in the new year, warn the providers.
Good Energy, EDF and Energy UK trade association have told the Financial Times that urgent government action after gas prices in wholesale markets rose more than 500 percent in less than a year.
Emma Pinchbeck, CEO of Energy UK, described the situation as a “nationwide crisis”.
She told the FT: “Other government bonds 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 will rise by over 50 percent in the New Year, a problem for” normal people ‘Business and the Economy.’
Experts have called for urgent intervention after gas wholesale costs rose more than 500% in less than a year, saying the UK’s response is lagging behind other European countries
Nigel Pocklington, CEO of Good Energy, a small renewable energy company, told the newspaper the UK was facing a “national crisis” after recent price hikes created “an extremely difficult operating environment for any company in the industry.”
EDF Energy has also warned that the government must act immediately to assist customers.
More than two dozen utility companies have gone bankrupt since early September, leaving thousands of people unemployed and keeping millions of households in suspense while they wait for a new supplier.
The biggest failure to date has been Bulb, once an energy success story that got into administration on Wednesday.
While Ofgem’s other 23 failed energy companies are moving customers to a new supplier, Bulb simply had too many customers to allow this to happen.
Instead, it will keep trading until it can be sold or its customers slowly move elsewhere.
More than two dozen suppliers have gone bankrupt since September, leaving thousands of people jobless and keeping millions of households in suspension while they wait for a new supplier through Ofgem
Suppliers said the cost will be passed on to households across the country, putting further pressure on the already soaring bills.
Many in the energy industry attribute some of the problems to the energy price cap. The cap is currently set every six months, and as gas prices have skyrocketed in recent months, providers are being forced to supply households with energy at horrific losses.
The government has meanwhile allocated £ 1.7 billion to support the company’s operations, a burden that could find its way onto household energy bills.
Industry regulator Ofgem has proposed a number of short and long term solutions to the problems that the price cap causes in extreme circumstances.
This includes reviewing the upper price limit every three months or revising it in favor of a six-month fixed tariff.