by Paul Sandle
LONDON (Reuters) – Britain’s energy regulator Ofgem announced on Friday an 80% increase in the energy price cap for British consumers from October, raising the annual household bill at an average of 3,549 pounds (4,203 euros).
The hike is going to have a “massive impact” on UK households, said Ofgem chief executive Jonathan Brearley, who added another hike was likely in January.
Energy prices have thus almost tripled in one year for 24 million households whose annual bill amounted to an average of 1,277 pounds last October.
Jonathan Brearley believes that the government should provide additional assistance to households to deal with this inflation.
“The government’s support package is providing immediate relief, but it is clear that the new prime minister will have to do more to tackle the impact of the price rises that will occur in October and next year,” he said. he declared.
“The response will have to match the magnitude of the crisis we are facing.”
Finance Minister Nadhim Zahawi said he was working on a plan to be ready for the next government, which will be appointed on September 5.
Outgoing Prime Minister Boris Johnson has confirmed that the government will announce further aid next month.
This will be for the most vulnerable and not for all households, he added, saying there should be no price caps for “absolutely everyone”, including “the wealthiest households in the country “.
Ofgem is not giving a forecast for January, when a new cap will come into effect, due to market volatility, but it said with winter gas demand, prices could ‘worse’ significantly” until 2023.
Already on the rise following the COVID-19 health crisis, gas and electricity prices have soared since the start of the war in Ukraine and under the effect of Russia’s decision to reduce its exports by gas to Europe.
Inflation in Britain has reached a four-decade high.
This price increase is reflected in UK consumer bills through a price cap calculated quarterly. Intended to prevent energy suppliers from making excess profits, it is now the ceiling price available for 24 million households.
Rising energy costs, which affect a range of products such as food and train and plane tickets, are set to amplify a crisis in purchasing power in Britain, as the Central Bank of England has warned of the risks of a long recession.
(Report Paul Sandle; French version Jean Terzian and Alizée Degorce, edited by Kate Entringer and Sophie Louet)