UK energy prices to soar

With an economy already on the way to being crippled by rising costs and a freefalling housing market, consumers in the UK received another nail in the coffin with the news that two of the country’s most powerful energy suppliers – ScottishPower and Npower – will be further raising their prices for gas and electricity at the beginning of the new month.

The news sees ScottishPower – who have over 5 million customers – inflict an increase of 34 percent on gas prices and 9 percent on electricity, with Npower – who have 6.6 million on the books – raising gas by 26 percent electricity by 14 percent, these to take effect immediately.
    

Windfall tax called for

The continued rise in price of essential services is of great concern both to the population and the government of the UK, with a recent suggestion that a ‘windfall tax’ be levied on the energy supplier in order to aid those who find heating their homes an ever increasing expense in these troubled times.

A coalition of charitable organisations – among them Age Concern and National Energy Action – has called for direct government action in the face of an estimated 5.5 million households facing expenditure of greater the 10 percent of income on heat and light – the definition of which is ‘fuel poverty’ – in the rapidly approaching winter months.
    

Concern for the elderly

The group expressed concern, in particular, that pensioners would be increasingly worried about the ability to heat their homes this winter, and may be inclined to cut back on other essentials in order to afford fuel.

This is the second such increase from the major suppliers in the year to date, and represents a further blow to the UK pocket at a time when food and petrol prices are rocketing to all time highs, and the economy struggles in the face of the general economic downturn.
    

Government to respond

A government response to the calls is expected, although it is difficult to see what Prime Minister Gordon Brown’s Labour government can do in addition to the measures already in place.

With £225 million already outlined in the social fund for the poorer customers, a figure due to be utilised over the next three years, those providing the funds – companies dedicated to social programmes and help for the poor – will undoubtedly face calls to provide more funding in the face of the impending rises.

The government is currently looking into renewable energy schemes to replace the nuclear and coal fired power plants that will be shut down under EU legislation, a controversial area in itself.