UK household energy bills to soar by 80% in October

Jonathan Brearley, CEO of Ofgem, said the increase would have a “huge impact” on households across Britain and a further increase was likely in January, reflecting significant price pressures in the energy market.

“It is clear that the new prime minister will have to do more to deal with the impact of the price hikes coming into October and next year,” Brearley said.

Rising wholesale energy prices are hitting countries around the world.

As European governments seek to protect gas, increase storage and cut bills, the race to elect Boris Johnson as prime minister on Sept. 5 has left Britain’s government reeling.

The two candidates have been at loggerheads over how to answer. His proposals, which include suspending environmental taxes or reducing sales taxes, have been dismissed by analysts as too little to prevent an unprecedented hit to household budgets.

Finance Minister Nadim Zahavi said on Friday that he was working on a plan to prepare for the next government, although he acknowledged that the new price would cause stress and anxiety for millions of people.

Ofgem said it was not giving an estimate for January when the new cap would come into effect because the market is so volatile, but said the winter gas market meant prices could “worse significantly” by 2023.

Energy bills have risen this year following Russia’s invasion of Ukraine and Moscow’s decision to cut gas exports to Europe, with wholesale gas and electricity prices already rising after the pandemic.

The new average electricity and gas bill for 24 million households means energy bills have almost tripled since October last year when they averaged £1,277, a major factor in inflation rising to a 40-year high.

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