Monday, September 26, 2022

Charities warn fuel poverty could double in a year

THE number of fuel poor households in the UK will double in a year if the crisis in Ukraine leads to higher energy bills, charities are warning reports the BBC.

Analysts are predicting that the war has pushed up wholesale prices, and could mean the average domestic bill in the UK hits £3,000 in October.

National Energy Action said that would put 8.5 million households in serious financial difficulty from fuel bills.

That would be twice the number of a year earlier, equating to 30% of homes.

Charity Age UK said such an increase would have a “devastating” impact on the health and wellbeing of older people, many of whom could go without heating for weeks.

The cost of gas and electricity for the typical household, on a tariff governed by the energy regulator Ofgem’s price cap in England, Wales and Scotland, is already rising by 54% to nearly £2,000 from the start of April. Prices are also rising sharply in Northern Ireland.

A string of energy analysts have predicted that the conflict in Ukraine, and the knock-on for gas supplied by Russia, could have a relatively sustained impact on the wholesale price of energy.

UK suppliers, and ultimately consumers, are not immune to those global price rises, even though Russia only provides about 5% of the UK’s gas supplies.

Analysts have suggested that could be reflected in the next calculation of Ofgem’s price cap, which would take effect at the start of October. Many, including the suppliers’ own trade body, say the average household bill could get close to, or reach £3,000 a year.

National Energy Action, which campaigns for warm, dry homes, said the number of households in fuel poverty was already expected to go up from four million in October 2021, to 6.5 million after April’s price rise.

That would go up again to 8.5 million in October this year, if the typical bill increases to £3,000. That is a possibility but still far from certain, owing to the volatility of the war, the international picture, and wholesale prices.

The charity’s definition of fuel poverty is a household which needs to spend more than 10% of their household income on fuel to heat their home to a satisfactory standard. Similar definitions are used officially in parts of the UK, although in England the definition of fuel poverty used by the government is a more complex calculation.

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