Proposed £21 ‘coronavirus hike’ on household energy bills slammed as ‘shocking’ and ‘farcical’

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The Canary

British households may have to shoulder a hike on their energy bills from the beginning of April because of new proposals from Ofgem. The suggestion is already drawing strong criticism from groups which claim the energy companies have been “ripping us all off, plunging people into fuel poverty while raking in juicy profits”.

Increase

The regulator has proposed an increase to the maximum many households can be charged on their bills, claiming that the pandemic is putting pressure on energy companies.

Ofgem said it is considering a £21 per household coronavirus hike to the default price cap when it next comes up for review. This would come on top of any other changes made to the amount energy companies can charge customers on their default rates.

The current price cap, which runs between October 2020 and the end of March 2021, is set at £1,042 per household for both gas and electricity. Ofgem reviews this cap every six months, and was already widely expected to hike the cap in February when it announces the new cap which will come into force in the beginning of April.

Hike

Energy prices have gone down in the last three consecutive reviews. However wholesale energy prices have recovered from the lows they hit earlier this year when demand for fuel collapsed because of the coronavirus crisis.

Ofgem claimed the potential £21 hike will help remove some of the pressure on energy companies who are facing high levels of unpaid bills as households struggle to keep up during the pandemic. The hike would allegedly let them recover an estimated £200m of bad debt.

Consultation on the proposals will run until 21 December, and Ofgem will share its decision in February before announcing the new price cap. Many of Britain’s biggest energy companies have laid off thousands of workers during the pandemic.

E.On became the latest on Thursday when it announced around 695 jobs will be cut. It followed Centrica, which announced 5,000 cuts in June, and Ovo, which said it would cut 2,600 jobs in May.

“Shocking”

Director of We Own It Cat Hobbs criticised the proposal:

These proposals from Ofgem are absolutely shocking. The idea that at a time when millions of people are struggling to pay their bills, the solution would be to charge people even more is farcical.

For far too long, private energy companies have been ripping us all off, plunging people into fuel poverty while raking in juicy profits. It has to stop.  But we can’t expect the private companies or a toothless regulator to stop extracting as much money as possible out of people through energy bills.

The only way we will deliver a fair system is to kick out the profiteers and bring our energy into public ownership, which would save us billions and is backed by the majority of the British public. By bringing just the energy networks into public hands we’d save £3.7 billion every single year.

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    1. Proposed £21 ‘coronavirus hike’ on household energy bills
      slammed as ‘shocking’ and ‘farcical’
      /////
      Just some point here every U.K. Household need to understand
      About the price rip off here in this article. It is of Tory Govt making.
      //
      P-1**The Tory Govt is not subsiding the power firm like they say
      they are paying we Joe public are by bigger bills.
      P-2** The Tory Govt enforce L-Down on us all, so we use more
      Power in our homes now every day (we get no help)
      P-3** The power firm are now reaping the big rewards of L-Down
      by setting bigger bills on us household users.
      P-4** The Tory Govt are part of the plane of ripping off us resident
      By the L-Down rules the place on us all so increasing our energy bills.
      P-5** The Tory Govt before starting L -Down rules should have
      CAPED all the energy bill Before putting us all in L-Down
      why did they not voter+ resident (think of this problem?)
      P-6** What deal did Tory Govt make with energy firm when we
      Got put in L-Down knowing this ‘true’ FACT! we public
      would all have to use more energy every day.
      P-7** This fact is especially important FACT resident + voters alike
      Some of worker are working from home using large amount of power
      Now because of L-Down rules will they get a refund or benefit help
      With their larger energy bills Boris yes or no?
      P-8** Boris will the firm be told to pay the extra cost of their workers
      Energy bills as they work from home because of L-Down rules them
      working from home as employee should not be stuck with large energy
      bills just to keep their job + employment safe Boris.
      //
      FINALLY
      Boris + Hancock + useless SAGE staff every time you L-Down U.K.
      it cost us public cash did you ever think about the cost to us before
      Locking us Down this mess with energy bill is of your making by the
      L-Down rules in place now (that will serve No purpose whatsoever)
      As the Virus is an AIRBORNE Virus every living thing on this planet
      at some time will get it –FACT Boris + Hancock + useless SAGE staff
      you did not L-Down U.K. for the flu death WHY?

    2. I realise I’m no economist, but it seems to me that government is ensuring that businesses can maintain their profits in the face of the pandemic, while the people the government is supposed to support, ie, voters, suffer unemployment, poverty, restrictions to their liberty and threats to their mental and physical health. But that’s what capitalism is all about, isn’t it, and that’s what England voted for when it elected the tories.
      The burden of heating, lighting and all the other energy-consuming now falls on the individual, working from home, while businesses whose energy-intensive offices are now lying empty don’t have this expense to bear. I wonder if staff can claim energy costs against their tax bill, as businesses can? And, of course, increased costs will also be borne by those who have either lost their job, or who didn’t have one to start with.

      1. Some good point in your post-Cailleach bheag
        Just so you understand me a bit better
        I am a free voter No ties to any party in power or out of power
        I also pay No fees to any party in Govt
        in addition I have never VOTED for a Tory party memebr at all.

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