UK Government urged to act as energy price cap soars over £3,500
Energy regulator Ofgem has confirmed that the energy price cap will rise by an average of 80 per cent from 1 October, taking the typical bill from £1,971 per year to £3,549.
This is in line with expectations, with analysts predicting that the cap would rise to £3,500 before going up again to £4,200 in January.
Ofgem chief executive Jonathan Brearley acknowledged that the cap would create “hardship” for many households and urged whoever wins the prime ministerial race to “provide an additional and urgent response to continued surging energy prices”.
“We know the massive impact this price cap increase will have on households across Britain and the difficult decisions consumers will now have to make. I talk to customers regularly and I know that today’s news will be very worrying for many,” he said.
“The price of energy has reached record levels driven by an aggressive economic act by the Russian state. They have slowly and deliberately turned off the gas supplies to Europe causing harm to our households, businesses and wider economy. Ofgem has no choice but to reflect these cost increases in the price cap.
“The Government support package is delivering help right now, but it’s clear the new Prime Minister will need to act further to tackle the impact of the price rises that are coming in October and next year.
“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.”
Financial campaigner Martin Lewis, the founder of Money Saving Expert, called the rise “hideous”, but stressed that it has not come as a surprise.
SNP Westminster leader has called on the government to scrap the cap, which is supposed to protect customers against paying a loyalty premium if they do not change providers on a regular basis.
"The Tory government must scrap the energy price cap rise or it will bear the blame as people are pushed into poverty and businesses are forced to close their doors,” he said.
"The UK's soaring energy costs are unaffordable and unsustainable. The UK Government must stop sitting on its hands, recall parliament and take action without further delay.
"By refusing to use its reserved powers to tackle this Tory-made cost of living crisis, Westminster is failing families and making the case for independence."
Chancellor Nadhim Zahawi said the government is taking action by making £400 available to every household, with further help for certain bill-payers.
“I know the energy price cap announcement this morning will cause stress and anxiety for many people, but help is coming with £400 off energy bills for all, the second instalment of a £650 payment for vulnerable households, and £300 for all pensioners,” he said.
“While Putin is driving up energy prices in revenge for our support of Ukraine’s brave struggle for freedom, I am working flat out to develop options for further support. This will mean the incoming Prime Minister can hit the ground running and deliver support to those who need it most, as soon as possible.”