The number of people in fuel poverty will double by October amid the cost of living crisis, the boss of one of the ‘big six’ energy companies has warned.
Michael Lewis, E.ON’s UK’s chief executive, said the average annual energy bill could top £3,000 when Ofgem raises the energy price cap again in four months’ time leaving millions struggling to pay.
Lewis said many customers were already “on the edge” after price cap rise last month saw bills rise from £1,277 to £1,971.
A further price rise in October, when the cap lifts again, would plunge people into poverty, he warned.
Lewis said: “We are seeing a significant number of people in fuel poverty - that’s to say more than ten per cent of their disposable income spent on energy - and that’s risen to 20 per cent.
“And in October our model suggests that could rise to 40 per cent if the government doesn’t intervene in some way.”
Lewis called upon the Government to “tax those with the broadest shoulders” amid a row over whether a windfall tax should be slapped on oil and gas giants.
He also said that an increase in Universal Credit would “absolutely” help “people at the bottom of the income range who are most adversely affected by this”.
Around one million of E.ON’s eight million customers in the UK are already in some kind of arrears, which Lewis said they expect to rise by 50 per cent come October.
Lewis, who is on a reported £1 million salary and whose company made £6.6 billion profits last year, said how he listens in to customer calls and went on: “Frankly some people are at the edge, they simply cannot pay.
“That will get worse once prices rise again in October. We are entering the summer period where people are turning their heating off anyway. October will see a price rise and increase in consumption - that’s when it’s going to hit.”
Rachel Reeves MP, Labour’s Shadow Chancellor of the Exchequer, said: “These comments underline how tough the cost-of-living crisis is for families, and how Conservative delays will see the situation get even worse.
“The Government must act now, by bringing in a windfall tax on oil and gas producer profits to cut bills.”
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