UK households will experience serious financial hardship this winter as their energy bills will double compared to 2021, despite the recently introduced annual price cap of 2,500 pounds ($2,879), John Pettigrew, the head of UK electricity operator National Grid, said.
In September, then-UK Prime Minister Liz Truss announced a freeze on household energy bills at 2,500 pounds per year. The measure went into effect from October 1. It was initially expected to apply for the next two years, but new Chancellor of the Exchequer Jeremy Hunt said in October that the program would run until April 2023.
"Even with the price cap this is a doubling-up of what people are used to paying for their energy bills. Therefore inevitably there are going to be people who are going to struggle," Pettigrew said, noting that the price cap was funded by taxpayers.
For comparison, in 2021, the average annual energy bill in the United Kingdom was 1,277 pounds. In this regard, even a bill rebate of 400 pounds cannot cover the difference due to soaring energy prices.
The National Grid chief said that the UK government should develop a more effective system to support the population once the price cap for energy bills is removed in April."Something like a social tariff makes a lot of sense," Pettigrew said.
Earlier in the day, National Grid announced the launch of an energy support fund of 50 million pounds for the next year and a half. The money will be used to donate to organizations that help the most vulnerable households amid a record increase in the cost of living, the Financial Times reported.
In October, the operator presented an emergency plan that provided for systematic three-hour power outages in the country in the event of a cold winter and an interruption of Russian gas supplies. According to UK energy regulator Ofgem, the UK is facing a gas shortage caused by the ongoing energy crisis, as a result of which some gas-fired power plants may go bankrupt.
Western countries and their allies have been facing a massive energy crisis and struggling to fill their gas reserves in time for the heating season for months now, as they slapped sanctions on Russia over its special military operation in Ukraine.
The sanctions caused significant disruptions in supply chains and a spike in food and energy prices worldwide. In the UK, the rising cost of living has hit millions of households.
You can read this article as it originally appears at Sputnik here.
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