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Britain’s energy bills could hit £3,600 a year in winter, experts warn

Britain’s energy bills could hit £3,600 a year in winter, experts warn

Experts have reportedly warned that energy bills in Great Britain could go over £3,600 ($4,382) a year during the winter as surging wholesale prices are expected to continue driving up household costs until 2024, at least.

According to research firm Cornwall Insight, the energy price cap is on course to reach £3,615 ($4,400) a year from January, a rise from the last month’s estimate of £3,363 ($4,094).

The energy regulator Ofgem set the cap at £1,400 ($1,704) a year recently, in October 2021.

Craig Lowery, Principal Consultant, Cornwall Insight, conveyed that the reason behind the spike is the high uncertainty regarding the gas availability from Russia to the EU as winter approaches.

Expressing no surprise at the ongoing situation, Lowery added that it was not unusual to see the firm’s forecasts changing by as much as £100 ($121) a day and that the firm has been noting a progressively upward trend in its forecasts all through spring and summer.

He further stated that these forecasts will continue witnessing a progressive trend in 2023 and may till 2024.

Cornwall Insights has predicted that the average annual household energy bills will hit £3,700 ($4,504) by the second quarter of 2023 and might fall back to £3,470 ($4,224) in the last quarter.

With inflation reaching a 40-year high, consumers in the UK are struggling immensely with the cost-of-living crisis.

In response to the crisis, the U.K. government has introduced a multibillion-pound support package. It includes a £400 ($487) discount for all households, a £150 ($183) rebate from council tax bills for some households, and a payment of £650 for over 8 million low-income houses.

Craig stated that Cornwall’s forecasts of a rise in the energy cap have increased by over £500 since the package was unveiled.

He said that while the £400 ($487) payment will make a dent in the forecasted increase, it is not enough to offset these predictions.

A month earlier, management consultancy BFY forecasted that the average energy bill could hit £3,850 ($4,686) a year by January 2023.

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Omkar Patwardhan

Omkar Patwardhan started his professional career in the hospitality industry. Having nurtured a deep-sated passion for words however, he found his way into content writing and now pens down articles for numerous websites, including News Origins, spanning the sectors of business, finance, and technology.