LONDON – Britain decided to keep its energy price guarantee (EPG) at current levels for a further three months, easing pressure on households as the government works to ensure bills reflect falling natural gas costs.
The EPG will remain set at £2,500 (S$4,080), the Treasury said on Wednesday.
That means dual-fuel tariffs will stay stable up until July, though customers will still be paying almost double what they were charged two years ago.
Consumers previously expected to see annual energy costs rise by £500 in April despite slumping gas prices.
Goldman Sachs Group has said keeping the EPG the same will also support an easing in British inflation to 1.8 per cent later this year.
“With energy bills set to fall from July onwards, this temporary change will bridge the gap and ease the pressure on families, while also helping to lower inflation too,” said Chancellor Jeremy Hunt.
A 90 per cent drop in gas prices since last August is yet to show up as a reduction in bills.
This is because energy firms pay for supply months in advance and charge customers according to costs at the time of purchase.
But consumer advocacy groups have urged policymakers to ensure bills don’t rise when real-time prices are falling.
Still, Britons will continue to pay far more than they did before Russia’s invasion of Ukraine.
The average annual household energy bill from April will be £285 more than a year earlier, according to the Energy and Climate Intelligence Unit, an independent nonprofit.
An energy bill support programme – a £400 subsidy given over the winter – is also set to end in April.
The energy price guarantee means that the government limits the maximum price per unit of power and gas, paying any cost of a bill above that level.
Source: straitstimes.com
