Energy suppliers urge UK government to act as winter bills threaten to rise

Energy UK, the trade body for energy suppliers, has urged the UK government to provide immediate help to households struggling with energy bills this winter. It warned that inaction could make the crisis deeper and more expensive over the longer term.

Bills for households on variable tariffs covered by Ofgem’s price cap rose by 4% at the start of October. That added about £60 a year, taking the typical annual bill for gas and electricity to £1,723.

Forecast points to £1,999 annual bill

Cornwall Insight forecasts that the same typical bill could reach £1,999 in January. BBC figures indicate that a 16% rise could affect about 20 million households on tariffs linked to Ofgem’s cap.

Energy UK said government support had not offset high wholesale costs. VAT on electricity bills was cut on Thursday, while some levies were cancelled or moved into taxation earlier this year.

The trade body linked the wholesale-price pressures partly to international events, including conflict in the Middle East and disruption to shipping through the Strait of Hormuz. It compared the situation with the 2022 crisis, when prices were driven higher by Russia’s invasion of Ukraine.

Energy UK’s proposed measures

Energy UK is calling for targeted support beyond the £150 Warm Home Discount, a gradual move towards a discounted social tariff and debt relief for the most severely affected households. It also wants more levies removed from electricity bills and transferred to taxation.

The organisation said rising customer debt now adds an average of £67 a year to everyone’s bills. Adam Scorer of the National Energy charity backed the assessment, saying low-income households were accumulating more serious levels of debt.

Prime Minister Andy Burnham said the government was considering measures that could ease pressure on households. EDF Energy chief executive Simone Rossi had warned that the UK was “walking into a second energy crisis”; Energy UK said action was needed before bills rose again.