E.ON boss says 40% of households could be pushed into fuel poverty by soaring energy prices this winter | Economic news

Up to 40% of households could be pushed into energy poverty by soaring energy prices this winter, the boss of one of the UK’s biggest energy providers has told Sky News.

Rising wholesale gas prices, fueled by the war in Ukraine, mean that the ceiling for domestic energy prices is expected to rise from Current £1,971 for typical use, up to £3,420 in October and up to £3,850 in January.

Michael Lewis, the chief executive of E.ON, which supplies gas and electricity to almost four million homes, said without more direct government help, millions of homes will spend more than 10% of their income in energy, the definition of energy poverty. .

“We called for more interventions earlier in the year as we could see up to 40% of our customer base fall into energy poverty,” he said.

“We expect prices to be in excess of £3,000 and possibly up to £3,500 depending on how wholesale prices develop.

“Beyond that in January, we would certainly expect high wholesale prices to fuel the post-Christmas price cap and likely a further increase.

“So there’s no doubt about it, these awards are unprecedented.

“I’ve never seen anything this high in my 30 years in the industry, and certainly nothing that’s risen this quickly. So there is a big challenge.”

Tips for saving energy from the Energy Saving Trust

  • Avoid overfilling the kettle
  • Insulate your water tank, pipes and radiators
  • Only run your dishwasher when it’s full
  • Swap your bath for a shower
  • Spend less time in the shower
  • Avoid the dryer
  • Run your washing machine on a 30 degree cycle instead of higher temperatures and reduce usage
  • turn off the lights
  • Draft proof windows and doors
  • Turn off your devices in sleep mode.

Mr Lewis has warned that existing government support for the most vulnerable, worth up to £1,200 a year, will be swallowed up by the impending increases.

He called for an urgent commitment to home insulation and other measures to reduce energy consumption.

“The previous intervention announced by the government, which was £400-1,200 per customer, depending on their personal circumstances, was a huge relief for us as it meant we got targeted support,” he said.

“Unfortunately, since this announcement was made, wholesale prices have risen again and wiped out a lot of that.

“So absolutely, we’re going to start to see more people falling into fuel poverty despite this government intervention, which is why we need more help in the short term.”

“And that’s why we called for greater government intervention.

“People need help with these bills, things like removing environmental levies and VAT from bills, more targeted help, and we can do more with things like smart thermostats, insulation of cavity walls to help short-term customers reduce their bills.

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“And indeed why do we need to look long term at doubling net zero energy efficiency, which again is the closest thing we get to a silver bullet that addresses both the need short and long term to get rid of gasoline and get to net zero.”

The government says its current customer support is worth £38billion and both candidates to succeed Boris Johnson have promised to cut taxes on energy bills, with Liz Truss focusing on suspending green levies and Rishi Sunak pledging to suspend VAT on invoices, measures worth less than £200 per household.

Chancellor Nadeem Zahawi said he started considering additional consumer support beyond October this week, promising to do “everything in our power” to help people.

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