Ofgem, the energy regulator, has confirmed that gas and electricity bills for millions of households across Scotland and the rest of the UK will increase by £693 from April 1, 2022.
The increase will see the average household energy bill rise 54 per cent to £1,971 per year and may go up even higher in October after it conducts its next review in six months time.
Chancellor Rishi Sunak will make an announcement in Parliament and lead a press conference at 5pm from Downing Street setting out his plans to help people cope with the increase. It is being widely reported that Mr Sunak will commit to giving households in Council Tax bands A to D rebates funded by UK Government grants under targeted measures for those on a lower income or benefits.
The official announcement from Ofgem states that the energy price cap for average annual consumption on the standard tariffs will rise by £693 to £1,971 per year, while homes on pre-payment energy meters will see an increase of £708 to £2,017.
UK Government minister James Cleverly said some people are “always still going to struggle” with bills.
He told Sky News: “The Chancellor will be setting out how we are going to support people who are struggling to pay the bills – keeping people employed, making sure they have got money coming in to their pockets through their pay packets, making sure that with things like the Universal Credit taper and the increase in the living wage we are making sure people can earn more to help offset that.
“But we are also having, in parallel to that, targeted measures to support people with their energy bills.”
Mr Cleverly added: “For some people they are always still going to struggle, we are very, very conscious of that.
“But we really hope the combination of general financial support – keeping people in work, making sure that work pays, supporting people on the lowest incomes – and the very targeted measures specifically about energy costs will make sure that, we hope, the majority of people who are concerned about fuel bills get support.”
Commenting on the increase, Andrew Bartlett, chief executive of Advice Direct Scotland, said: “This sharp rise will be a devastating blow for many households across Scotland.
“It will cause deep anxiety and financial worries, leaving many people facing the stark choice of heating or eating.
“But Scots don’t have to struggle alone - free, impartial and practical advice is available to everyone in Scotland through our energyadvice.scot service.
“And charities and organisations in Scotland which provide debt, money or energy advice can sign up at homeheatingadvice.scot as a ‘referral partner’ to access a £3m Scottish Government fund for those in fuel poverty or rationing their energy use.”
Citizens Advice Scotland Chief Executive Derek Mitchell said: “This eye-watering increase is a hammer blow for consumers. One in three of us already find bills unaffordable and shamefully almost half a million people in Scotland have had to cut back on food to deal with unaffordable bills.
“This simply isn’t a sustainable position for people. April will be a nightmare scenario as rising bills and prices in the shops collide with flat or falling incomes, creating a perfect storm that could sweep millions of people across the UK into poverty, debt and destitution. No one should be forced into the heart breaking choice between keeping their homes warm or feeding their families.
“We need immediate direct interventions. To be clear we are looking for the UK Government to intervene to limit the detriment that these unprecedented bill increases will cause. We also need a long-term plan to keep bills down."
James Taylor, Executive Director of Strategy at disability equality charity Scope, said: “The huge increase in the price cap will be catastrophic for many disabled people who are already forced to commit a large amount of their income to energy costs. Finding an additional £700 is going to be hard, if not impossible for many.
“Spiralling living and energy costs are already hitting disabled people hardest. Scope’s research shows that half of disabled people whose household bills have increased in the past three months have seen their health and mental health get worse."
He continued: “Scope’s energy hotline and website have been inundated by disabled people facing impossible choices, with nowhere else to turn.
“We need to go much further than rebates. We urgently need [UK] Government support targeted at disabled people who are bearing the brunt of this cost of living crisis.”
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