Since it purchases gas from the EU, the UK is still susceptible to the consequences of EU’s political activity even after Brexit. This has led to the projection that half of the UK households is set to be in a fuel poverty by January.
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EDF, a French utility with operations in both the UK and France, has warned that the unabating rise in energy costs might trigger fuel poverty for as many as half of British families.
“When you look at the figures more than half of UK households will be in fuel poverty in January, meaning they will have to spend more than 10% of their disposable income on their energy bill,” said Philippe Commaret, managing director of consumers at EDF, as quoted by Energy Live news.
This week, the UK’s energy market regulator Ofgem is expected to reveal the most recent energy price cap, which will result in a significant increase in the cost of electricity for millions of Britons.
The price cap is typically revised twice a year in order to protect households from unreasonably high bills by limiting the price increases that suppliers may pass along to them.
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The cap was increased by more than 50% in April of this year, which caused an overnight increase in the number of fuel-stressed homes in the UK. However, the UK’s cost-of-living problem is still far from over because energy prices are set to rise by further 42% in October when the energy regulator raises the price cap once more.
However, the adjustment appears to be far more than previously anticipated, with the newest projections showing costs for millions of households reaching 6,500 pounds per year next year, all due to increasing natural gas prices. This works out to around $7,600 each year.
Since it purchases gas from the EU, the UK is still susceptible to the consequences of EU’s political activity even after Brexit.
A senior VP from Moody’s commented on the UK’s energy predicament this week on CNBC: “The impact has been exacerbated by high electricity prices in Europe, where drought conditions have affected hydro power plants and unplanned outages have reduced French nuclear output.”