Winter vitality payments to soar as fears rise over shortages

Households throughout Britain face a second winter of sky-high vitality payments as a consequence of an absence of gasoline storage services to stop provide shortages.

Days after British Gas proprietor Centrica introduced document earnings of £969million, vitality consultants have warned the UK’s continued dependence on imports will put us on the mercy of wholesale worth fluctuations.

They argue the Government has failed to make sure the nation is totally ready for a chilly winter when elevated demand for gasoline and electrical energy will deliver a repeat of the distress suffered final yr.

Global gasoline costs soared after Russia’s invasion of Ukraine induced provide points.

Analysis by the International Monetary Fund discovered family budgets right here had been hit “harder than any country in western Europe” by vitality prices final yr.

This was partly as a result of many gasoline storage services had been closed in 2017.

They are set to be re-opened however the UK can at present solely retailer sufficient gasoline to final a couple of days – whereas nations equivalent to Germany and the Netherlands can maintain sufficient to satisfy months of demand.

Rishi Sunak is ready to announce contemporary funding in Britain’s oil, gasoline and renewable vitality business to make sure tyrants like Vladimir Putin can by no means once more use vitality as a weapon to blackmail.

The Prime Minister and Energy Security Secretary Grant Shapps will meet business leaders this week to debate boosting home-grown manufacturing and storage.

But vitality insiders worry a harsh winter may go away thousands and thousands unable to pay their payments. They have urged Chancellor Jeremy Hunt to attract up plans to bail out the poorest households with additional subsidies on gas payments, the Sunday Express has discovered.

A spokesperson for Energy UK, which represents suppliers, mentioned: “While prices have fallen, they are still extremely challenging for many customers and further increases cannot be ruled out.

“This winter will be difficult for many households and businesses. It is therefore essential the Government is ready with a targeted mechanism for customer support which can respond to events.”

Leading assume tank the Henry Jackson Society can be warning the Chancellor have to be ready to supply additional help, with subsidies focused at individuals on decrease incomes to scale back the fee to the Treasury.

It will say in a report this week: “Experts agree the winter of 2023/24 is not going to be any easier than the previous ones.

“It could be even worse.”

The report will add: “We urge the Government to continue with price caps (and similar subsidies for energy bills) whenever necessary to help households and businesses survive the winter.”

Centrica’s announcement of document six-month earnings for British Gas – up from £98million a yr earlier to £969million – was met with anger by clients.

The surge has been blamed on vitality watchdog Ofgem elevating its worth cap to permit suppliers to cost extra.

It at present limits annual payments to £2,074 for a typical family, down from £4,279 in November final yr.

The Government’s Energy Price Guarantee additionally limits family payments however that is set at £3,000, which implies prices may improve considerably. Industry insiders say permitting payments to come back near the £3,000 mark would depart thousands and thousands unable to pay.

Ofgem figures confirmed 845,555 households had been in arrears on their gasoline invoice within the first quarter of this yr, up from 598,300 in 2019.

Labour on Saturday night time claimed the lack of storage services had price £1.7billion by forcing the nation to purchase gasoline at larger costs moderately than shopping for when the cost was low and storing it.

Shadow Chancellor Rachel Reeves mentioned: “Yet another failure on energy security hasn’t just left families paying more, it’s left us exposed and reliant on others.”

But the Tories hit again and accused Labour of placing 213,000 jobs in danger with plans to ban new oil and gasoline licenses.

A Conservative evaluation discovered the coverage may price a further £87billion in misplaced revenues, with Labour abandoning as much as 1.16 billion barrels of oil and greater than 19.8 billion therms of gasoline.

Mr Shapps mentioned: “Energy security is national security. Since the illegal invasion of Ukraine the Government has driven Putin from our energy market, paid around half of a typical family’s energy bill and grown our economy by driving forward major energy projects.

“This week we will go even further, forging ahead with critical measures to power up Britain from Britain – including supporting our invaluable oil and gas industry, making the most of our home-grown energy sources and backing British innovation in renewables.”