UK Electricity Bills to Jump 10%

Household electricity bills in the UK will rise by 10% this October after regulator Ofgem raises the energy price cap in response to higher wholesale electricity costs for suppliers.

“We know that this rise in the price cap is going to be extremely difficult for many households,” Ofgem chief executive Jonathan Brearley said, as quoted by the Financial Times.

“Anyone who is struggling to pay their bill should make sure they have access to all the benefits they are entitled to, particularly pension credit, and contact their energy company for further help and support.”

The October cap hike is the first since January and will see the average annual electricity bill of a British household rise to some $2,250 from around $2,055. No explanation has been provided for the increase in wholesale electricity costs that prompted the cap hike.

Earlier this month, a consumer advocacy organization warned that up to a quarter of British households may be forced to turn off their heating and hot water this winter following the Ofgem price cap revision. The estimated hike was lower than the actual one, at 9%.

The Citizens Advice report said the percentage of those worried about the affordability of their electricity was substantially higher among households with children, where the percentage was 31%, and low-income households, where 39% were worried about the coming heating season.

The consumer advocacy group also reported that 48% of respondents in its survey had said they would have to turn down the heat or turn it off to survive winter financially. Another 34% said it would be difficult for them to afford food, mortgage payments, or childcare this winter because of higher electricity prices.

Meawhile, the Labour government has canceled some $2 billion in fuel subsidy payments to more affluent pensioners in a bid to fill a $29-billion funding hole in the budget.

By Irina Slav for Oilprice.com

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