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Brit’s Home Energy Bills Will Be At ‘Devastating’ Levels Till ‘At Least 2024’

by Thomas Richard
August 03, 2022, 10:16 AM
in News and Opinion
Reading Time: 2 mins read
A A
6

offshore wind sunsetDomestic energy bills in Britain will remain at “devastating” levels into 2024 and potentially beyond, analysts are predicting, adding pressure on the government to provide further financial aid to cash-strapped households.

Energy consultancy Cornwall Insight has warned there is little relief in sight for households struggling with soaring electricity and gas costs as it forecast Britain’s energy price cap was likely to remain “significantly” above £3,000 a year on average until “at least 2024”. [bold, links added]

The group, which has been among the most accurate forecasters of British energy prices, is estimating the cap will hit nearly £3,360 a year in October when it is next altered by the regulator Ofgem and will remain relentlessly high throughout 2023 and into 2024.

The energy price cap dictates bills for more than 23mn households and provides an estimate based on average use.

October’s forecast marks a 70 percent increase on the current level of £1,971 a year and would represent a 163 percent rise in bills compared with last winter.

Ofgem is due to announce the October level at the end of August.

Cornwall Insight believes the cap could exceed £3,600 in January before hitting a peak of nearly £3,730 in the second quarter of 2023.

It is likely to remain elevated, at around £3,470 a year, at the end of 2023, according to the group’s latest forecasts, as forward energy contracts suggest there will be little let-up in the high wholesale gas and electricity prices that have been driving domestic bills higher, particularly following Russia’s invasion of Ukraine.

“While the rise . . . for October and January is a pressing concern, it is not only the level — but the duration — of the rises that makes these new forecasts so devastating,” said Craig Lowrey, principal consultant at Cornwall Insight.

“Given the current level of the wholesale price, this level of household energy bills currently shows little sign of abating into 2024.”

Although some of Cornwall Insight’s forecasts for October and January are lower than other recent estimates, the group is among the first to predict that soaring energy prices will continue to hit consumers’ pockets until 2024 and possibly even longer.

The warning triggered fresh pleas from fuel poverty campaigners and opposition politicians to boost financial aid for households already struggling with a surge in the cost of living.

Conservative leadership contender Rishi Sunak in May announced a fresh package of support for households to be delivered in the autumn, including £400 off all households’ energy bills.

However, critics pointed out on Tuesday that forecasts for October’s price cap had risen by more than £500 since that £400 relief was announced.

Based on Cornwall Insight’s latest estimates, the charity National Energy Action said a further 2mn households could be plunged into fuel poverty this winter, where surging energy bills mean people cannot afford to live in a warm, dry home.

Read more at Financial Times

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Comments 6

  1. Tom says:
    3 years ago

    The Fed will send electronic pesos to help out.

  2. Spurwing Plover says:
    3 years ago

    No Shorebird or Seabird will be safe from those Wind Turbines

  3. Sonnyhill says:
    3 years ago

    The problem won’t go away as long as voters ‘ choices are restricted to socialists. If you are a smart and ambitious capitalist , you do not enter British politics. You leave the UK. No sense hanging around trying to fix stupid.

    • Keith says:
      3 years ago

      You are so right. Both the Labour and Conservative parties have totally wrecked our energy industry by only listening to the greens of Greenpeace, WWF, FoE and the ultra left wing of the civil service.

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