The UK energy crisis could cost every UK household an additional Â£ 120 to cover the expenses of dozens of energy supplier collapses this winter, potentially plunging hundreds of thousands of households into fuel poverty for the first time.
Investec analysts say consumers in England, Scotland and Wales could have to pay a total of Â£ 3.2bn to cover costs left by broken gas and electricity providers , in addition to paying record market prices for gas and electricity.
The bank warned of a “substantial” burden on households to provide a safety net for customers of failed suppliers, including the largest to date, Bulb Energy, which has plunged into a slump. special administrative process last week.
“The collapse of the supply market is likely to result in substantial additional costs for every UK household, which is hardly welcome when fuel poverty is an issue, inflation is an issue and commodity costs are expected to be. drive up energy bills, âInvestec said.
Martin Young, an analyst for the wealth management group, said the process of identifying the full cost of the energy crisis was “akin to an attempt to nail jelly to a wall,” but the figure could reach 3.2 billion pounds sterling, which most likely will be ‘pooled’ across the market through energy bills.
This sum includes the cost of transferring customers to a new supplier who must then purchase additional gas and electricity at current market rates, which are near record levels, and cover any unpaid policy costs left by the customer. supplier down.
The figure also includes the Â£ 1.7 billion put in place by the Treasury to pay Bulb to continue supplying gas and electricity during the winter via a special administrator, which can be recouped from bills from household energy once the fate of the business has been decided.
Energy bills have gone from an average of Â£ 1,138 per year to Â£ 1,277 per year since last month under the energy regulator’s price cap, which is used to limit price increases for 11 million households paying a standard bi-fuel tariff by direct debit. The cap is expected to rise further in April, due to the surge in energy market prices in recent weeks.
The increase has raised concerns among fuel poverty activists that hundreds of thousands more households could fall into fuel poverty. The additional burden of Â£ 120 to cover the cost of bust providers could lead to an additional 350,000 households in fuel poverty.