The UK’s vitality value disaster will change into “actually horrific” with as many as 40 per cent of individuals being pushed into gas poverty except Rishi Sunak takes pressing motion, the boss of considered one of Britain’s greatest suppliers has warned.
Scottish Energy chief govt Keith Anderson stated the chancellor should act urgently and be “extra radical” to restrict the impression of rising gasoline and electrical energy costs.
Mr Anderson instructed MPs that Scottish Energy had been inundated with 8,000 calls from prospects frightened that they’d not have the ability to afford to energy their properties.
It got here as Hayden Wooden, the boss of Bulb, was instructed it was “staggering” that he continued to obtain a £250,00-a-year wage underwritten by taxpayers, after the vitality provider collapsed final yr.
Mr Wooden stated he had been working “very laborious” to minimise the fee to taxpayers of Bulb’s failure.
Scottish Energy’s Mr Anderson stated he was “massively involved for individuals” going through giant invoice will increase. “There are such a lot of people who find themselves going to essentially, actually wrestle.”
He added: “There’s a large quantity of tension from individuals on the telephones about what they will do and what they face… Lots of people for the primary time going through this concern, they’ve by no means been on this place earlier than.
The vitality boss stated his greatest concern was what would occur in October, when the worth cap is ready to leap once more, taking the typical invoice near £2,000 a yr.
Whereas the cap has already risen 54 per cent this month, shoppers are partially cushioned from the impression by hotter temperatures, which imply decrease vitality payments.
“Come October [things are going to get horrific, truly horrific,” Mr Anderson told MPs on the Business, Energy and Industrial Strategy (BEIS) Committee.
“I honestly believe the size and scale of this is well beyond what I can deal with, what this industry can deal with. We need a massive shift, a significant shift in the government approach towards this.”
“I think the problem’s got to a size and scale where it requires something significant of that nature where, for those people who are deemed to be in poverty… that puts their bill back to where it used to be before the gas crisis.”
Mr Anderson called for a deficit fund and a “social tariff” which would replace the heavily criticised energy price cap.
Under the plan, vulnerable households and customers on lower incomes would receive a discount of up to £1,000 a year on their bills.
The money would be repaid by energy customers and taxpayers over a 10-year period.
E.On UK chief executive Michael Lewis also backed a social tariff, but said more immediate measures such as a reduction in VAT were required.
He warned that between 30 per cent and 40 per cent of people in Britain might go into fuel poverty from October when the price cap is likely to rise significantly again.
Current government measures have widely been seen as inadequate. The chancellor declined to offer further support for struggling families in his latest tax and spending announcement.
Mr Sunak chose to stick with previously announced rebates on council tax bills and a £200 discount on retail energy bills which will be repaid through a levy on bills over the next five years. The two schemes will only cover a fraction of the increases that energy customers face.
With around a third of households expected to be struggling to afford adequate heating and electricity this winter, pressure is mounting on the government to do more.
Mr Anderson urged ministers to accelerate the transition to renewable energy, which he said was being held back by inadequate investment and cumbersome planning systems which make it slower to build new capacity in the UK than in many other countries.
Vladimir Putin’s invasion of Ukraine has highlighted Europe’s reliance on Russian oil and gas, giving renewed impetus to the drive towards net zero emissions.
Soaring prices have helped to force more than two dozen suppliers out of business in the past 12 months. The boss of British Gas owner Centrica warned MPs that more suppliers would go under next year.
Hayden Wood, the chief executive of Bulb, which has been propped up with more than £1.7bn of public funding, defended his actions in the run-up to his company’s collapse into special administration.
Asked by the committee whether it was “morally justifiable” that he continued to receive his £250,000-a-year salary after Bulb failed and was bailed out by the government, Mr Wood said he and his team had been working “very hard”.
He added: “Everything we are doing right now is to try and complete a sale of the company so that we can minimise the cost to taxpayers and minimise the disruption to consumers.