E.ON boss says rising energy prices could push 40% of households into fuel poverty this winter | business news

Rising energy prices could push up to 40% of households into fuel poverty this winter, the boss of one of Britain’s biggest energy suppliers told Sky News.

Soaring wholesale gas prices, fueled by the war in Ukraine, mean the domestic energy price cap is expected to rise by currently £1,971 for typical use, up to £3,420 in October and up to £3,850 in January.

Michael Lewis, CEO of E.ON, which supplies gas and electricity to nearly four million homes, said that without more direct government help, millions of homes would spend more than 10% of their income on energy, the definition of fuel poverty.

“We called for more intervention earlier in the year as we could see up to 40% of our customer base falling into energy poverty,” he said.

“We expect prices in excess of £3,000, potentially up to £3,500 depending on how wholesale prices develop.

“Beyond that by January we would certainly expect the high wholesale prices to feed into the price cap after Christmas and likely another hike.

“So there is no doubt, these awards are unprecedented.

“I’ve never seen anything that high in my 30 years in the industry, let alone anything so fast. So that is a big challenge.”

Energy saving tips from the Energy Saving Trust

  • Avoid overfilling the kettle
  • Insulate your water tank, pipes and radiators
  • Only run your dishwasher when it is full
  • Swap your bath for a shower
  • Spend less time in the shower
  • Avoid the tumble dryer
  • Use your washing machine on a 30 degree program instead of higher temperatures and reduce consumption
  • Turn off the light
  • Draft-proof windows and doors
  • Switch your devices out of standby mode.

Mr Lewis warned that existing government support for the most vulnerable, worth up to £1,200 a year, will be swallowed up by the threatened increases.

He called for an urgent commitment to home insulation and other energy-saving measures.

“The intervention previously announced by the Government, which was £400 to £1,200 per customer depending on their personal situation, was a huge relief for us as it gave us targeted support,” he said.

“Unfortunately, since that announcement, wholesale prices have rebounded, wiping out a large chunk of it.

“Despite this government intervention, we will definitely see more people falling into energy poverty, which is why we need more short-term help.”

“And that is why we have called for more government intervention.

“People need help with these bills, things like removing green fees and VAT from bills, more targeted help and we can do more with things like smart thermostats, cavity wall insulation to help customers lower their bills in the short term.

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“And indeed, why we need to address the long-term doubling of net-zero energy efficiency, which I repeat is what we come closest to having a silver bullet that addresses both the short-term and long-term imperative , step on the gas and get to net zero.”

The government says its existing support for customers is worth £38bn and both candidates to succeed Boris Johnson have pledged to cut taxes on energy bills, with Liz Truss focusing on suspending environmental taxes and Rishi Sunak promising stop VAT on bills, measures worth less than £200 per household.

Chancellor Nadeem Zahawi said he had begun considering additional support for consumers beyond this October and vowed to do “everything in our power” to help people.

E.ON boss says rising energy prices could push 40% of households into fuel poverty this winter | business news

Source link E.ON boss says rising energy prices could push 40% of households into fuel poverty this winter | business news

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