Gas and electricity prices are projected to rise for 15 million families in the United Kingdom.
ENERGY prices for 15 million UK households will rise by at least £139 starting in October, according to regulator Ofgem.
The energy price cap has been raised, resulting in a £139 rise in annual gas and electricity bills for consumers on the basic plan.
Direct debit payments are currently used by around 11 million households in the United Kingdom. The annual ceiling on pre-paid energy, which is used by nearly four million homes, will rise by £153 to £1,309, a 13 percent increase.
The increase was attributed to higher wholesale energy costs, according to Ofgem.
Ofgem’s chief executive, Jonathan Brearley, admitted that this can be “very distressing news” for some families.
Mr Brearley explained that the price cap means that energy providers cannot charge customers more than the predetermined amount, and that companies can offer customers a contract that is less than the set amount.
He also advised Britons to contact their existing provider as well as look at other options.
“Higher energy costs are never desirable, and the timing and magnitude of this increase will be particularly tough for many families now dealing with the effects of the pandemic,” the Ofgem chief added.
“With the price cap, suppliers can only pass on genuine energy supply costs and cannot charge more than the price cap threshold, however they can charge less.
“If you’re having trouble paying your account, contact your supplier to see what assistance is available and, if possible, look around for a better offer.
“I understand that this is distressing news for many people; nevertheless, I pledge to consumers that Ofgem will do all possible to protect them during winter, particularly those in vulnerable circumstances.”
The energy cap is computed using a combination of wholesale gas prices, energy suppliers’ network expenses, and costs of government programs such as renewable energy subsidies. It is evaluated twice a year.
Since the energy cap was implemented in February 2019, wholesale gas contract prices have nearly doubled.
The coronavirus pandemic has also wreaked havoc on the energy business, with low stock levels and supply chain disruptions.
Citizens Advice’s James Plunkett warned that the surge might create a “perfect storm” for families who are already trying to make ends meet.
“This price increase could create a perfect storm for families,” he warned. Brinkwire Summary News