Great Britain: Energy prices jump, tariff shield rises by 80% – 08/26/2022 at 10:48.
Great Britain: Energy prices jump, tariff shield rises by 80%.
By Paul Sandl
LONDON (Reuters) – Britain’s energy regulator Ofgem announced on Friday that the energy price shield for British consumers has risen 80% since October, raising annual household bills by an average of 3,549 pounds (4,203 euros).
The walkout will have a “huge impact” on UK households, Ofgem chief executive Jonathan Briley said, adding that there could be another walkout in January.
Energy costs for 24 million households have tripled in a year, from an average of £1,277 last October.
Jonathan Brealey believes the government should provide more help to families to cope with these rising prices.
“The government’s support package is providing immediate relief, but it is clear that the new prime minister has a lot to do to mitigate the impact of the price hike in October and next year,” he said.
“The response must be commensurate with the scale of the crisis we are facing.”
Finance Minister Nadim Zahawi said he is making plans to be ready for the next government to be appointed on September 5.
Ofgem is not giving a forecast for January, when a new cap will come into effect due to market volatility, but said that with winter gas demand, prices “could worsen significantly” until 2023.
Gas and electricity prices have risen since the start of the war in Ukraine following the coronavirus health crisis and Russia’s decision to cut gas exports to Europe.
Britain’s inflation has hit a four-decade high.
This price increase will be reflected on the bills of British consumers through a price shield calculated every quarter. The shield, designed to prevent energy suppliers from making excessive profits, is now a price ceiling for 24 million households.
As the Bank of England has warned of the risk of a prolonged recession, rising energy costs, which drive products such as food and travel tickets, are set to stretch Britain’s purchasing power.
(Reporting by Paul Sandle; French version by Jean Terzian and Alizee Degource; Editing by Kate Intriger)