Energy UK urges new support scheme as bills forecast to hit three-year high

Energy UK is urging the British government to implement a new, targeted 'social discount' scheme to assist vulnerable households as energy bills are projected to reach a three-year high this winter. The industry body suggests that the current £150 Warm Home Discount is insufficient, noting that it fails to account for essential energy consumption driven by health conditions or poorly insulated homes. Energy UK proposes a system that uses income, health, and consumption data to provide up to £450 in support to those most in need.

This call for action comes as regulator Ofgem prepares to announce the energy price cap for October. Analysts at Cornwall Insight predict a 4% increase, which would bring the annual bill for a typical household to approximately £1,729. This rise is attributed to volatile wholesale energy markets influenced by conflicts in the Middle East and increased power demand during European heatwaves.

Financial pressure on consumers is already significant, with Ofgem reporting that customer debt to energy suppliers reached a record £4.7 billion at the end of last winter. While recent government measures, such as the removal of VAT on household electricity, aim to provide relief, experts suggest these savings may be offset by rising wholesale gas costs.