Millions of households in Great Britain will be pushed into fuel poverty as the energy price cap rises by more than £220 a year from Wednesday. The cap on gas and electricity rates will increase to the equivalent of £1,862 annually, forcing 13.5 million homes to spend over 10% of their income on energy bills, according to the End Fuel Poverty Coalition.
The coalition, which based its calculations on research by the University of York, warned that nearly 5.5 million households will face energy costs amounting to about 20% of their income, up from 4.3 million in April. Simon Francis, the coalition's coordinator, said: “These figures show the reality behind the headline price cap figure: a growing number of households are spending an unsustainable share of their income just to heat their homes in winter and keep them cool in summer.”
Under the new cap, electricity rates will rise from 24.67p to 26.11p per kilowatt hour, and gas charges from 5.74p to 7.33p for direct debit customers. The typical annual dual fuel bill will be £1,862 under the regulator's previous methodology, or £1,663 using new assumptions of lower consumption. Energy analysts at Cornwall Insight forecast that bills could remain high, with the average bill potentially falling slightly to £1,654 from October.
The surge in costs has reignited calls for government action. Unite union general secretary Sharon Graham said: “The increase in the energy cap is another kick in the teeth for workers and families.” Labour MP Andy Burnham, widely expected to become prime minister, has proposed greater local control of essential services to curb living costs. Francis urged that any new government must introduce a permanent social tariff and break the link between gas and electricity prices.
Energy consumers minister Martin McCluskey acknowledged the concern, stating: “We know families are deeply concerned about rising energy bills because of a war we did not choose.” He noted that the government has removed some policy costs from bills and expanded the warm home discount scheme to benefit 6 million households, and will continue to monitor the situation before winter.
