COP29 has brought climate finance to the forefront of global discussions, highlighting the urgent need for developed nations to support...
Read More- Energy Insights
High Energy Bills Continue to Hit UK Consumers
-
Tom Coyne
Discover More
This August, Jonathan Brearley, the Chief Executive of Ofgem, warned that the price cap would increase from the 1st October Since then, the energy industry has faced unprecedented hurdles and high energy bills. The price of gas has risen by 550% since January.
Exacerbating the price increase for providers is the government’s price cap for household consumers. This has left many providers unable to honour their price promises to customers, forcing nine energy providers to collapse.
Whilst the energy price cap is meant to protect household consumers from price spikes in the energy market; similar safeguards are not present for businesses. This has meant that businesses have borne the full brunt of the crisis with extremely high energy bills.
Andrew Large, Director General of the Confederation of Paper Industries, told the BBC that the current crisis represents “a highly inflationary situation for the British economy and members will clearly be in a position where they do try to pass those costs on to consumers where they can”.
Price comparison websites have warned that the number of tariffs available has been dramatically reduced and that it may be better to simply brace yourself through the winter rather than look at switching.
However, this advice encourages idleness and could leave consumers in an even worse position next year.
Cornwall Insight, a market intelligence firm, suggest that bills could rise 30% in 2022. The firm expects the price cap to increase from £1277, set this October to around £1660. Indeed, Ofgem has already confirmed that a continuation of current gas prices will result in further price cap increases.
“Dale Vince told BBC Radio 4 “It’s illogical to hold prices at one end of the supply chain and not the other end, and the consequence is companies going out of business”.
He went on, “The government currently have closed their eyes and ears to this and said they don’t care, they’re not going to help energy companies but that kind of misses the point because they’re killing energy companies right now”.
It is paramount that businesses begin to think strategically about their energy consumption and ways of reducing their high energy bills. With the gas crisis predicted to continue into the new year, take the initiative and get in contact with BP to make sure your business is in the best position to face the ongoing crisis.