£3,000 energy bills for millions as price cap is hiked next spring

MILLIONS of households will see their energy bills soar by £900 from April after the Government’s support scheme was drastically cut yesterday.

Jeremy Hunt said he will allow the cap on average annual bills to rise from £2,500 to £3,000 from spring as part of efforts to find tens of billions in savings to balance the books.

At the same time, the universal £400

‘Condemned to fuel poverty’

grant to all households to help with this winter’s bills will end.

At present, households are getting a £66 to £67 reduction every month under the Government’s six-month Energy Bills Support Scheme, which lasts until March.

This will end at the same time as the cap is raised, meaning many families could see their energy bill soar by £900 a year – £75 a month.

However, Mr Hunt said grants for low income and vulnerable households will

continue. Those on certain meanstested benefits will get a £900 oneoff payment, while pensioner households will get £300 and disabled people £150. Some households will qualify for more than one of these.

Meanwhile, the cost to the taxpayer of bailing out energy supplier Bulb has soared to nearly four times initial expectations, according to the Office for Budget Responsibility. Its assessment of the Autumn Statement yesterday said the total cost for propping up the failed supplier has reached £6.5billion, ahead of its sale to Octopus Energy.

The changes to energy bills support will squeeze the household budgets of millions of low-middle and middle earners who won’t qualify for the grants. But an extra £1billion of funding will enable a 12-month extension to the household support fund, helping local authorities to assist ‘those who might otherwise fall through the cracks’.

Unveiling his Autumn Statement yesterday, Mr Hunt said: ‘From April, we will continue the Energy Price Guarantee for a further 12 months at a higher level of £3,000 per year for the average household. With prices forecast to remain elevated through next year, this will still mean an average of £500 support for every household.’

Under former PM Liz Truss’s plan, the energy price cap would have been frozen at £2,500 for two years, costing billions more.

Rocio Concha, director of policy and advocacy at consumer champion Which?, said: ‘Additional support for the most financially vulnerable and the new price guarantee will bring some much- needed relief to those struggling most, but it may still not be enough – particularly if bills remain this high next winter. It’s not just those on the lowest incomes who will struggle to afford higher bills.

‘For example, people on lowermiddle incomes will just miss out on extra support and will need to find more than £1,000 extra to cover their energy costs.’ Simon Francis, of the End Fuel Poverty Coalition, said: ‘The Chancellor has now condemned seven million UK households to fuel poverty this winter. The rise in the energy price cap from April next year could see this figure rise to 8.6 million households.’