UK Energy Price Cap Could Jump As Much As 46% in October
The average UK household could be paying almost £2,900 for their annual energy bill from October, according to an estimate which predicts an even sharper rise than the country’s regulator.
New modeling by energy consultant Cornwall Insight forecasts that regulator Ofgem’s price cap could soar 46% to £2,879 in October, then another 3.6% to £2,907 from January, according to a statement Wednesday.
The regulator expects the combined cap for power and gas to rise 42% in October to £2,800, Ofgem’s chief executive officer told lawmakers last week.
The UK government has been compelled to hand out energy bill discounts to millions of households across the country as they battle with a cost of living crisis. Chancellor of the Exchequer Rishi Sunak has allocated a £15 billion ($19 billion) aid package in response to rising energy costs and is likely to face further pressure for aid next year.
“Volatility in the energy market has seen Default Tariff Cap predictions rise to unprecedented levels, as players in the energy industry react to instability and fears of widening sanctions,” said Craig Lowrey, principal consultant at Cornwall Insight.
Norwich, UK-based Cornwall Insight said that while European sanctions on Russian oil have a minimal direct impact on the UK, continuing uncertainty over the supply of Russian natural gas to Europe has kept international wholesale gas prices high.
