An increase in standing charges, and the lack of a £400 discount as government support are the leading factors making the gas and electricity bills higher – even if the price per unit of energy is getting cheaper
Surrey, United Kingdom Aug 31, 2023 (Issuewire.com) - Geeky News, a technology and lifestyle journal, is excited to announce the publication of its latest article titled "UK Households Set to Pay More On Energy This Winter Despite Price Cap Cut." The article sheds light on the recent developments in the UK's energy market and their implications for households across the country.
In a move aimed at providing relief to consumers, energy regulator Ofgem recently reduced the price cap on household energy bills by approximately 7% for the final quarter of 2023. The revised cap, which comes into effect on October 1st, sets the limit at £1,923 per year--a reduction from the previous cap of £2,073 for the typical dual-fuel household.
Despite this reduction, a concerning trend emerges. A significant proportion of UK households are still poised to face higher energy bills during the upcoming winter compared to the previous year. According to a comprehensive analysis by the Resolution Foundation, around 35% of households--equivalent to approximately 7.2 million people--will experience an increase in their energy expenditures this winter.
Citizens Advice, through a meticulous study, predicts that the average monthly energy bill for households will surge by a minimum of £32.33 between January and March 2024, when contrasted with the energy costs during the same period in the preceding year. This increase is attributed to rising standing charges and the absence of the government support discount of £400. Despite the declining cost per energy unit, these factors contribute to an overall bill escalation.
The record-breaking highs in wholesale gas and electricity prices in the UK and Europe last year, exacerbated by disruptions in the global energy supply chain due to the Ukrainian invasion, were responsible for the surge in energy costs. Whilst wholesale energy costs have since gone down considerably and Ofgem has taken measures to lower the price cap, persistent market volatility remains evident. Wholesale prices for gas and electricity have decreased by 85% and 80% respectively, yet the current price cap, while lower than its peak, still stands at a 60% increase compared to two years ago.
Various organisations including the End Fuel Poverty Coalition, National Energy Action, and Citizens Advice are calling for a social tariff to mitigate the challenges faced by vulnerable households. These organisations stress the importance of government intervention through bill support, social tariffs, and energy efficiency measures.
National Energy Action stated, "For a third straight winter, vulnerable households will face stubbornly high bills and an increasing energy debt mountain. This winter, there is no price guarantee and no £400 Energy Bills Support Scheme.
"The absence of targeted further financial support this winter to reduce the energy bills of the most vulnerable will mean millions of unheated homes and spiralling debt. It will add to the queues of people for the NHS and for the overstretched resources of charities like National Energy Action. The UK Government can still act--by directly reducing energy bills via targeted energy discounts or a more targeted Energy Price Guarantee for low-income and vulnerable households."
Geeky News urges households to take proactive measures to enhance their energy efficiency ahead of the upcoming winter season. Simple steps such as managing energy consumption and investing in home insulation can lead to substantial savings. Ensuring the optimal functioning of heating systems, like through services offered by Mulgas, can further contribute to energy bill reductions.
To read the full article, please visit: https://www.geekynews.co.uk/households-paying-more-this-winter/
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