This is a horrific example of the “poverty premium” and so too is the higher price cap of £3,608 for prepayment customers. However, the charity Fuel Bank Foundation estimates average monthly costs of £480 this December for 4.5mn UK households charged up front for energy usage, as they pay proportionally more in colder months. Indebted customers are commonly switched to prepayment meters. Never mind the growing Don’t Pay campaign - customers who can’t pay are already panicking and cancelling direct debits, says Gemma Hatvani, founder of the Facebook group Energy Support and Advice UK.Ĭancelling immediately raises bill costs by 6 per cent, rips up any existing repayment plan and could quickly lead to bad debts, damaging people’s credit scores for years.Īs we wait for news of further help measures, how many more will cancel? Without more support, unprecedented numbers stand to run up huge energy debts this winter - suppliers and regulators must work urgently to manage this. Depending on your usage and credit, your supplier may demand much more. If you’re among the 86 per cent of UK households on tariffs governed by the price cap, expect your energy supplier to ask to increase your direct debit before the next prime minister takes office.įor the average user, the £3,549 cap boils down to energy bills of around £300 a month from October 1.

There is so much that can be done now to manage the crushing financial blows we know are coming, and the Conservative leadership contest simply does not excuse the lack of government action to manage the devastating effects of these price rises.Īmid calls to freeze the price cap and extend existing support packages, here are some big issues MPs and regulators must address urgently as they draw up policy solutions.

Personal finances