Vishala Sri-Pathma and Kevin Peachey report that energy prices in the UK are expected to increase by 5% starting in April, resulting in an additional £85 per year for the average household, according to consulting firm Cornwall Insight. The firm, known for its accurate forecasts, predicts that a typical household’s annual gas and electricity bill will total £1,823.
Energy Secretary Ed Miliband has urgently written to Ofgem, the regulator responsible for setting the price cap, requesting swift action to safeguard consumers in light of the upcoming price hikes. The projected increase in energy prices coincides with anticipated rises in water and council tax bills in April.
On the positive side, minimum wage rates are set to increase, as well as benefits and state pension payments. Cornwall Insight anticipates that the energy price cap will rise from its current level of £1,738 per year for a typical household. The impending surge in household expenses will compound pressure on the government, already under scrutiny for discontinuing the winter fuel allowance for elderly individuals not receiving pension credit or other financial assistance.
Ofgem is scheduled to announce the new energy price cap level on 25 February, affecting homes across England, Wales, and Scotland. The price hike is attributed to a combination of colder weather and dwindling gas storage levels across Europe, resulting in a notable surge in wholesale prices. While current bills are roughly 50% higher than pre-pandemic levels, they remain below the peak experienced in 2022 during Russia’s invasion of Ukraine, which caused energy prices to spike
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