UK News Will the energy price cap rise by another £280 in April next year?
Wind or solar? You could soon choose your home's energy source
We also reveal the smart tech that could soon be in every home - from holographic TVs costing £143 a year to run, to 'smart toilets' at £36 and robot lawn mowers at £8.In what is being termed an 'energy on demand' service, households will be able to change their energy mix with just a couple of taps, according to experts at Energy Helpline.
The next energy price cap, due to come into effect in April next year, could increase by a further £280 – before the £139 hike has even kicked in, a new report has revealed.
Rapidly rising wholesale costs, that has sent the industry into meltdown, mean prices are likely to soar with energy suppliers hoping to cling to survival, according to analysis by comparison website, the Energy Shop.
It comes at a time where fourlast week with near a million consumers moved to a new supplier.
Over the past five weeks, since the latest energy price cap was announced, the increases in wholesale prices have been 'staggering' with the natural gas prices for winter 2021 rising more than fourfold over the past 12 months, according to Intercontinental Exchange.
Christmas dinner is under threat, gas suppliers warn
Meat producers have warned Britain could be facing a shortage in as little as two weeks - as gas supplies claim Christmas dinner is under threat amid a gas crisis.There is growing alarm that the food and drink industry could be badly hit by the closure of two fertiliser plants – in Teesside and Cheshire – due to gas price rises.
Prices have risen by 324 per cent from 14 September 2020 to the same date this year.
Meanwhile, whilst wholesale gas prices for Britain are available, it is difficult to get hold of the same for wholesale electricity prices, according to the Energy Shop, therefore, it has based predictions on power prices in Germany.
These show an 174 per cent rise in costs from 14 September 2020 to the same time this year.
Joe Malinowski, founder of the Energy Shop, said: 'The current energy market has been turned on its head.
'It is no longer about optimising your energy spend – it is now a question of protection and survival - literally.
'If you can find a fixed energy deal anywhere near the level of the 1 October 2021 energy price cap, just take it.
Supermarkets are ALREADY selling festive products - before Halloween
Tesco, Sainsbury's, Marks and Spencer and Co-Op have already started putting out Christmas items on their shelves. It comes as today fears were raised of meat shortages due to a lack of CO2 gas.In a literal twist on the phrase 'it's Christmas come early', shoppers have spotted a surprising number of shelves stocked with festive products.
'It may not seem a good deal now but when energy price rocket by another £280 next spring you will be glad you did.'
How wholesale prices is impacting consumers
Wholesale energy price increases will see households encounter even higher bills than experienced over the past year.
This is concerning for many, especially as the after effects of the pandemic continue, with many still in financial difficulty.
Even more worryingly, experts believe this will lead to the energy price cap increase increasing by £280 - a massive jump from the £139 due to be added at the beginning of next month.
This is concerning as the 12 per cent hike is the highest the cap has seen since it launched in 2019.
Malinowski said: 'The shocker is that the level of wholesale energy prices has increased by twice as much in the last five weeks as it did in the six months prior.
'The simple maths implies that, as things stand, the next level of the cap will increase by around £275 to £280.
Fears continue over future of energy firms as minister insists price cap must 'remain in place'
Fears remain over the future of a number of UK energy providers due to surging gas costs, as it was confirmed the price cap must "remain in place".Fears remain over the future of a number of UK energy providers due to surging gas costs, as it was confirmed the price cap must "remain in place".
'This would take the energy price cap, when it is next reviewed, and increased, on 1 April 2022, to around the £1,555 mark.
'To put that into context, price protected standard tariffs would be 50 per cent higher than they were two years prior. They would be twice the level that the cheapest tariffs in June of last year.'
|Price then||Price now (15/9/2021)||% change|
|5-week change (vs 6 Aug 2021)||109.1||183.5||68%|
|1 year change (vs 14 Sep 2020)||43.3||183.5||324%|
|Source: UK Natural Gas Futures – Winter21 contract (p/therm)|
|Price then||Price now||% change|
|5-week change (vs 6 Aug 2021)||92.9||154.7||66%|
|1 year change (vs 14 Sep 2020)||56.4||154.7||174%|
|Source: EEX German Power Base Quarter Jan 2022 (Eur/mWh)|
This price shock has yet to come, but it will hit consumers in the near future, the Energy Shop warns.
Video: 'Energy price cap to stay' says Minister (Sky News)
It said the more immediate impact is felt in the competitive market where energy suppliers use wholesale prices to price and hedge their 'cheap' energy tariffs before offering them out for sale.
Don't get burnt in the energy crisis: How to keep cool as bills soar
An unprecedented gas supply crisis is threatening to add hundreds of pounds to our energy bills as we head for a bleak winter. Here we explain how to keep your cool and beat the heating bills blitz.Scores of small power providers are at risk of going to the wall in the coming months — forcing millions of us on cheap fixed deals to pay much more at a time when rising prices and taxes are already hitting our pockets.
Here, it claims, the impact has been severe and un-precedented. 'Cheap' discounted tariffs have all but disappeared, as have a number of the energy suppliers offering them.
Many of the lowest price tariffs are now well over a thousand pounds when consumers used to have a selection for under £900 last year.
Research from The Energy Shop shows for many suppliers, the standard tariff – which was typically the expensive rip-off product – is now the cheapest available product, which is a reversal of the normal functioning of the market.
|Supplier||Number of customers affected||New supplier appointed by Ofgem|
|27-Jan-21||Simplicity Energy||50,000 domestic||British Gas Evolve|
|27-Jan-21||Green Network Energy||360,000 domestic||EDF Energy|
|09-Aug-21||Hub Energy|| |
|07-Sep-21||MoneyPlus Energy||9,000 domestic||British Gas|
|07-Sep-21||PFP Energy|| |
|14-Sep-21||People's Energy||350,000 domestic||British Gas|
|14-Sep-21||Utility Point||220,000 domestic||EDF|
It added some energy suppliers still have fixed deals cheaper than the price capped product. However, the list is small and shrinking very rapidly.
Instead, many suppliers have hiked their cheapest deals to above the energy price cap and are no longer offering the standard price capped tariffs to new customers.
Millions face fuel price hikes as Tesco warn of panic buying
Millions of households are facing the prospect of skyrocketing energy bills after dozens of suppliers came under threat due to the gas crisis as regulator Ofgem warns the situation is 'unprecedented.'Millions of families pay paying more than £400 extra as the ongoing crisis causes further suppliers to collapse.
The Energy Shop says customer choice is collapsing rapidly - and so too are energy suppliers.
Only last week, Utility Point, People's Energy, PfP Energy and MoneyPlusEnergy all announced they were.
Suppliers are now caught between having cheap fixed price tariffs sold to their customers and rapidly rising input commodity costs.
As such, those who have not fully hedged their input costs find themselves in trouble over the next few weeks.
|Energy Price Cap Version|| |
|Running total (to date)||£97 increase|
What happens next?
In a highly uncertain market, there is much uncertainty as to what might happen next.
However, the Energy Shop said there are three possible ways this can pan out.
1. Wholesale prices can continue to increase - and potentially a lot further
2. Wholesale price can stabilise at these elevated levels
3. Wholesale prices can fall back and/or collapse
Over the longer-term markets are self-correcting mechanisms, therefore, it expects that today's extreme price signals will lead to increased energy supply that will, in turn, address the supply and demand imbalance leading to lower prices going forwards.
Certain factors creating the current imbalance including nuclear plant maintenance shutdowns and low wind generation are temporary and will at least partially ease the situation.
Octopus Energy considers wrapping tentacles around Bulb amid sector crisis
Octopus Energy is exploring a move to take control of Bulb, its rival challenger brand, amid the crisis in Britain's residential energy market that has triggered a swathe of corporate casualties. © Other Octopus Energy is exploring a move to take control of Bulb, its rival challenger brand Sky News has learnt that Octopus Energy is among the parties which have requested access to a data room set up by Bulb's financial advisers in an attempt to secure new funding during the coming weeks.
However, others, including restricted gas flows from Russia and negligible LNG arrivals in Europe due to Asia demand, are more difficult to call.
Even if, or when, wholesale energy prices do start to turn downwards, there is still much uncertainty as to how far will they fall and when this will happen.
The consensus currently emerging is the supply situation will remain tight and precarious over the coming winter leading to high and volatile energy prices.
Thereafter, supply and demand should be more in balance with prices easing from spring 2022.
In this scenario the Energy Shop said they would expect to see some or all of the following:
1. Energy deals lower than the 1 October 2021 energy price cap will all disappear.
2. The number of energy suppliers still accepting customers onto their price protected standard variable tariffs will dwindle to a small positive integer not far from zero.
3. Some energy suppliers will stop taking on any new customers altogether while they try to stay afloat.
4. The next level of the energy price cap will see energy prices rocket by close to £300 to around £1,555.
5. More energy suppliers will fail. The question then becomes who will be prepared to step in to take over the energy supply of those customers and at what price?
6. In extreme circumstances, such as a Big Six supplier going bust, Ofgem may be forced to invoke emergency measures to suspend the energy price cap.
Figures have been recalculated based on the latest average domestic consumption values to make them comparable. These will differ from Ofgem's reported historic figures as Ofgem has not yet adjusted its data.
Carl Woods slammed for 'weird' statement in wake of Katie Price arrest .
As her family talk about 'worst fears' nearly coming trueKatie was arrested on suspicion of drink driving and was taken to hospital following the collision.