Energy Secretary Ed Miliband has described Ofgem’s price cap increase as “worrying” for many people.
The energy price cap will rise to an average annual £1,717 from October, the industry regulator has said – a 9.5% rise which Ofgem said was largely due to higher wholesale gas prices.
“This will be deeply worrying news for many families,” Mr Miliband said.
He said: “The rise in the price cap is a direct result of the failed energy policy we inherited, which has left our country at the mercy of international gas markets controlled by dictators.
“The only solution to get bills down and greater energy independence is the government’s mission for clean, home-grown power.
“That’s why we have hit the ground running, lifting the onshore wind ban, consenting unprecedented amounts of solar power and setting the largest-ever budget for our renewables auction.”
Mr Miliband said he would “do everything in our power to protect billpayers, including by reforming the regulator to make it a strong consumer champion”.
Another energy hike forecast next year
There’s more bad news for households after October’s energy price rise, according to analysts.
Cornwall Insight forecast the cap will be increased by another £45 in January.
This equates to a 3% increase on the average £1,717 per annum charged come Autumn.
“Unfortunately, a volatile wholesale market, and a country heavily reliant on imported energy has created a perfect storm for fluctuating household bills,” said Dr Craig Lowrey, Principal Consultant at Cornwall Insight.
This will only intensify calls for government protection, including social tariffs and targeted support, he said.
“The increase is also likely to reignite the debate over the effectiveness of the cap,” he added.
“While brought in with good intentions, it was only meant as a temporary measure, and some may argue the cap has served its purpose.
“One thing is clear: the current system is not meeting the needs of households, and without change, these risks being the case on an enduring basis.”
Leave a Reply