As many as four in 10 people in Britain could fall into fuel poverty when the gas price cap rises again in October, the heads of the nation’s energy companies have told the UK Parliament, The Guardian reported this week.
According to the publication, they have called for more government support for vulnerable households which are facing a “truly horrific” winter.
The chief executive of E.ON UK, Michael Lewis, said that between 30% and 40% of Britons could go into fuel poverty from October when the industry regulator is expected to put up the annual limit on tariffs.
“We are expecting a severe impact on customers’ ability to pay,” Lewis told members of parliament, adding that he expected customers’ debts to rise by 50%, or £800 million ($1.04 billion).
The E.ON chief’s concerns were echoed by ScottishPower CEO Keith Anderson, who said the company had received 8,000 calls from customers concerned about their ability to pay.
He said he was “massively concerned” for people facing rising bills who would “really, really struggle,” and called for the introduction of a deficit fund or social tariff for vulnerable customers. The fund would take £1,000 ($1,305) off the bills of the poorest people in the country in October and the government or consumers would then pay this off over 10 years, Anderson suggested.
“Come October, that’s going to get horrific, truly horrific,” he said. “It has got to a stage now where the size and scale of it is beyond what I can deal with, beyond what I think this industry can deal with. I think it needs a massive shift, a significant shift in the government policy and approach towards this.”
EDF Energy Chief Executive Simone Rossi also reported a 40% increase in calls from customers worried about debt.
The average household dual-fuel tariff has risen from £1,278 ($1,668) to £1,971 ($2,573) after the energy regulator lifted the price cap on bills earlier this month. Some experts expect the price cap to hit £2,600 ($3,394) in October.
Energy prices have been rising globally over the past six months but the West’s economic war with Moscow has exacerbated the problem.
The UK joined the US and the EU in imposing several rounds of sanctions against Russia, a major energy supplier to Europe. Western countries have pledged to end all imports of Russian coal by the end of this year, to be followed by a ban on imports of oil and natural gas in the coming years.
Gas prices in particular have surged in recent months in the UK, prompting almost every household energy supplier to raise rates to the maximum allowable level.
However, some consumer groups accused providers of having raised prices by more than needed, to strengthen their own balance sheets at customers’ expense.