There are fears many more will be pushed into poverty and hardship after it was revealed the energy price cap will rise to around £2,800 in October.
The head of the UK's energy regulator, Ofgem, described the soaring price cap as a 'once in a generational event,' with warnings that millions will face crisis as costs continue to rise. Jonathan Brearley told MPs that the price cap, which is currently at £1,971, will increase due to continued volatility in the gas market.
The energy price cap is the maximum price per unit that suppliers can charge customers. It rose sharply in April, getting to a point where average homes are now paying an extra £700 on their energy bills. The coming rise will strike fear into many.
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And the pain may not end there. Mr Brearley warned MPs that the price cap could rise again in the future, if Russia decided to disrupt supplies of natural gas. Europe relies on Russia for around 40% of its natural gas.
Reacting to the news, Frances O'Grady, general secretary of the Trades Union Congress said: "This is not sustainable. Millions of families are already at breaking point. A whopping £800 rise in bills will push many over the edge. We need an emergency budget now."
She is not the only one calling on Chancellor Rishi Sunak to act immediately to help people facing crisis over soaring bills. Mr Sunak is said to be considering a windfall tax on electricity generators and oil and gas giants.
Ofgem boss Mr Brearley also called for government action. He said: "We need the government to step in... broadly this is only something government can address. I know this is a very distressing time for customers but I do need to be clear with this committee, with customers and with the government about the likely price implications for October."
It is thought that at least one in four people are likely to face fuel poverty by October. Despite the unfolding crisis, the government has so far refused to step in. Asked about possible measures on Monday, Chief Secretary to the Treasury Simon Clarke poured cold water on the idea, saying ministers were “not going to rush into action”.
