Winter energy price rises are one forecast we can’t afford to ignore

IT may still be summer, with holidaymakers enjoying warm conditions on Westcountry beaches and windows left open to enjoy cooling breezes, but a winter storm is already brewing.

From October as temperatures fall and we head into the colder months, energy prices will soar to new heights, stretching the finances of householders across the country.

It is a cost-of-living storm that has been building over recent months, with the full force due to hit as the days shorten and falling temperatures force people to turn on the central heating.

This winter everyone will be more conscious than ever about the gas and electricity they use.

And with prices at the fuel pumps at alarming highs, and inflation pushing up the cost of food and a variety of commodities, people will be feeling more than the pinch as incomes are squeezed. The pain will run deep and looks set to endure.

Yesterday, energy regular Ofgem announced that the energy price cap, which regulates the amount households pay for their gas and electricity, will jump by around 80% from the start of October, pushing up bills to £3,549 per year for the average household.

Wholesale prices have increased eightfold over the last year for gas – which also has an impact on the cost of electricity generated by gas-fired turbines. Prices were already increasing as countries emerged from lockdown, while a cold winter in Europe last year drained reserves and demand has increased in Asia. However, the situation has been made much worse by the war in Ukraine and restrictions on Russian gas exports to Europe. Experts expect the cap to rise again significantly in January and again in April, and then to – hopefully – fall back again in July and October next year.

The spiralling cost of household power supplies is daunting – and will be made all the harder to bear this winter when lights need to be kept on and homes need heating.

All households have been promised a £400 discount on their energy bills, which will be paid in six monthly payments from October. For direct debit customers this will be taken off their payments. And eight million of the most vulnerable households will also get extra support, taking the total they can get to £1,200. These include a £650 one-off payment to households on means-tested benefits, a £300 payment to pensioners, and £150 for six million people who receive disability benefits.

Charities, think tanks, opposition parties and the two potential future Prime Ministers have said the Government will need to do more for struggling households. But any extra support will have to wait until the next Prime Minister is in place.

In the meantime, the Cornwallbased Crowdfunder organisation has launched a campaign urging those who own second homes in the Duchy to gift their £400 handout through a #DonatetheRebate scheme to help the needy in the county.

With 13,500 second homes in Cornwall, that equates to £5.4m – a hefty sum that could go a long way.

Now is the time for all to become informed about potential costs, assess one’s finances and possible help available and prepare for the energy price storm that is heading our way.