Energy price cap: Johnson confirms further financial support
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Yesterday, Ofgem announced that the price cap on household energy bills has now been raised to a record high £3,549 a year. This price rise, up from an already record high £1,971 in April, threatens to throw millions of households into fuel poverty, in which energy bills eat up a significant portion of their income. In light of this increase, Mr Johnson promised that Britons would see “extra cash” once the new Prime Minister, who is expected to be Liz Truss, is elected.
He said: “There’s a pipeline of cash coming through over the next few months and through the autumn and the winter.
“But that is clearly now going to be augmented, increased, by extra cash that the government is plainly going to be announcing in September.”
Mr Johnson added that he does not think ministers should “cap the whole thing” for “the richest households in the country”.
Meanwhile, Chancellor Nadhim Zahawi has warned that the Government will need to support both low and middle-income families with their energy bills this winter.
He said: “My concern is there are those who aren’t on benefits.
“If you are a senior nurse or a senior teacher on £45,000 a year, you’re having your energy bills go up by 80 percent and will probably rise even higher in the new year – it’s really hard.
“If you’re a pensioner, it’s really hard. So universal credit is a really effective way of targeting, but I’m looking at what else we can do to make sure we help those who really need the help.
“We’re looking at all the options.”
He added that the country was in a “national economic emergency [that] could go on for 18 months, two years”.
Energy bills in the UK have risen much higher than it other countries in Europe, including ones that are heavily reliant on Russian gas.
Speaking to Express.co.uk, Jess Ralston, Senior Analyst at the Energy and Climate Intelligence Unit said: “85 percent of the UK’s homes are reliant on gas for heating and we still generate a significant proportion of our electricity from it, so we are uniquely exposed to high gas prices and volatile markets.
“In the current market design gas can still set the price for renewable electricity, which is actually now nine times cheaper than gas, so any new Prime Minister will surely been keen to delink cheaper renewable electricity from expensive gas within their first few months of office.
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“We also have some of the most inefficient housing in Europe – with every 1C of heat a German house loses, the UK equivalent loses 3C – so we are buying more expensive gas than we might because of leaky buildings.”
And things could get even worse next year, with experts at consultancy Auxilione using latest gas prices to predict that the cap will rise by another 52 percent to £5,405 in January 2023, then by a further 34 percent to £7,263 in April – before falling slightly, by 11 percent to £6,485 in July and by another 7 percent to £6,006 in October.
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