UK CHANCELLOR MUST MAINTAIN ENERGY SUPPORT
Local MP Richard Thomson has urged the Chancellor of the Exchequer to scrap proposals to reduce energy support to households, as prices fall yet bills are set to rise. Ofgem has announced that from 1 April the energy price cap will fall, reflecting falling wholesale energy costs.
However due to current government support through the Energy Price Guarantee (EPG), there is a difference between the actual energy price cap set by Ofgem and what the typical household in England, Scotland and Wales will pay annually. At present, government support means the cap in reality is £2,500 - without government support, this would have been £4,279 since January.
UK Chancellor Jeremy Hunt is proposing to reduce support through the EPG scheme, meaning from April a typical household will pay around £3,000 a year for energy.
Mr Thomson is calling on the Chancellor to maintain current levels of state support, as it will take time for current falling wholesale energy prices to filter through to household bills.
Commenting, Richard Thomson MP said:
“To reduce state support now would mean heaping more pressure on strained household budgets. Falling wholesale prices means the level of government support required to make up the difference between Ofgem’s cap and the Energy Price Guarantee will taper down over time.
“Forcing households to bear the brunt, before wholesale price reductions can filter through to domestic bills, is deeply irresponsible. But let’s not forget, market prices going from £4,000 a year to just over £3,000 for energy is still absolutely catastrophic for households - especially considering typical energy bills in January 2021 were around £1,000 a year. Wholesale gas prices have dropped 75% since their peak in the summer.
“I’m joining with SNP colleagues to call on the UK Government to drop their Energy Price Guarantee cap by 20% to £2000. The cost-of-living crisis is continuing on the UK Government’s watch - we need to see action urgently.”