UK Regulator Raises 2022 Summer Energy Price Cap by GBP693
February 03 2022 - 6:59AM
Dow Jones News
By Jaime Llinares Taboada
U.K. energy regulator Ofgem said Thursday that it has raised the
country's price cap by 54% to 1,971 pounds ($2,675) per year, and
that it will announce further measures to fight market volatility
on Friday.
The new price cap for a dual-fuel, direct debit customer
represents a GBP693 increase from the current GBP1,277, reflecting
significantly higher gas and power prices. Sector analysts had
forecast that Ofgem would rise the price cap to around
GBP1,900.
The rise will come into force at the start of April and will
last for six months, until the end of September. Ofgem reviews the
price cap twice a year to reflect wholesale energy prices and other
costs that companies face. Last summer, the price cap for the
typical customer stood at GBP1,138.
"We know this rise will be extremely worrying for many people,
especially those who are struggling to make ends meet, and Ofgem
will ensure energy companies support their customers in any way
they can," Ofgem's Chief Executive Jonathan Brearley said.
The regulator added that it will announce further measures to
ease volatility in the energy market on Friday.
On Wednesday, before Ofgem announced the new price cap, trade
association Energy UK urged the country's government to protect
customers from the sharp increase in bills. "When international gas
prices are this high, there is a need for government to act, as
other governments already have, to make a real difference to bills
and to protect the wider economy," Energy UK's CEO Emma Pinchbeck
said.
Trade union GMB said the cost-of-living crisis is a direct
result of the U.K. government's energy strategy. "We need a
sensible debate about how we meet and pay for our energy, otherwise
tens of millions of workers and consumers--not to mention the
planet--will continue to suffer," GMB national secretary Andy
Prendergast said.
Write to Jaime Llinares Taboada at jaime.llinares@wsj.com;
@JaimeLlinaresT
(END) Dow Jones Newswires
February 03, 2022 06:44 ET (11:44 GMT)
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