As power bills are expected to jump to record highs this winter, UK households will struggle with a worsening cost-of-living crisis.
A new report via energy market intelligence firm Cornwall Insight Ltd. said the power bill price cap is set to rise to £4,266 ($5,168) per year in 1Q23, pilling even more financial pressures on consumers trying to survive the worst inflation storm in decades.
Cornwall Insight’s forecast comes as the price cap would breach the £4,000 for the first time, though the good news is energy costs in 2H23 should ease. Cornwall expects the price cap to remain over £3,700 through next year.
“While our price cap forecasts have been steadily rising since the Summer 2022 cap was set in April, an increase of over £650 in the January predictions comes as a fresh shock,” said Craig Lowrey, principal consultant at Cornwall Insight.
UK’s cost-of-living crisis was described by Nigel Wilson, the chief executive of asset management company Legal & General Group Plc, in a CNBC interview on Wednesday morning. He said high energy inflation is “a tragedy for many people.”
End Fuel Poverty Coalition warned rising power prices could result in 9.2 million UK households (28.4%) being thrown into fuel poverty by Oct. 1, adding the figure could increase to 10.5 million (32.6%) by January.
The pain of soaring energy inflation has led to a massive movement of nearly 100,000 people who have pledged not to pay their electricity bill this winter. We reported last weekend that “Don’t Pay UK,” a strike encouraging people to cancel power bill payments, was gaining moment as the anonymous group hopes to have more than a million Brits boycott paying their power bill by fall.
On top of high inflation and households experiencing the most misery in three decades, the Bank of England warned last week that the UK is expected to enter a recession. All of this is setting the stage for what could be protests in the streets.