Struggling households need more help with bills, energy industry says
Industry body Energy UK says the current support for households most in need does not go far enough.
Energy firms in the UK have urged the government to provide additional assistance to struggling households facing soaring energy bills, according to the industry body Energy UK. The persistent high prices have left some people requiring emergency support beyond the existing £150 Warm Home Discount. Ofgem, the regulator, is set to announce the energy price cap for October onwards, which is expected to reach a three-year high.
Energy UK's CEO, Dhara Vyas, emphasized the need for a more agile and better-targeted support scheme to better meet the needs of those in financial difficulty. A recent report by Ofgem revealed that customers who had fallen behind on their energy bills owed suppliers a record £4.7 billion. Energy consultancy Cornwall Insight predicts the cap will increase by 4% when announced, applying to household bills during the first half of the coming winter.
The rise in prices is attributed to the conflict in Iran, heatwaves across Europe, and increased demand for power generation for air conditioning and cooling. While the Prime Minister's decision to remove VAT on household electricity bills will provide some relief, it will not fully offset the impact of the price hike. Energy UK proposes a new social discount scheme that would offer targeted and adjustable support to those in need, potentially providing £450 in assistance to some households.
The proposed scheme could be funded through bills or government funding. The last time the price cap reached a similar level was in July 2023, when the Conservative government committed around £40 billion in external spending to support households with energy bills. Critics argue that combining personal data on income, health, and energy consumption and finding additional taxpayer money for such a scheme could raise concerns.
However, National Energy Action's Adam Scorer supports the proposed approach, emphasizing the need for a new and effective solution to provide breathing space for people in fuel poverty.
Written by urgent.news from BBC Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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