ENERGY bills are set to soar by 60% bringing financial pain to millions of people already struggling to pay. Experts blame the upward trend on wholesale costs and the green agenda which will force suppliers to invest in new technologies that consumers will have to pay for.
In a bleak prediction, industry analysts warn that annual electricity prices could rocket by 60 per cent, with gas increases of 54 per cent because of rising wholesale costs.The steep hike could result in total energy bills in excess of £2,000 a year.
Experts blame the upward trend on the green agenda which will force suppliers to invest in new technologies that consumers will have to pay for.
The experts warn that average electricity bills could rise £300 a year to £800 in the next 10 years and gas prices could increase from £845 annually to more than £1,300 – a leap of £455.
The predicted price rise “could be catastrophic for many households”, said Thomas Lyon of price comparison website uSwitch.com. He said consumers had already been “knocked for six” by this year’s hikes.
Among a panel of experts for SmartestEnergy, the UK’s leading purchaser and supplier of energy generated by the independent sector, 90 per cent predicted a rise, with one third saying it would be 60 per cent. The average increase predicted was 43 per cent by 2021 which would see electricity bills alone rise by more than £200 a year.
Robert Groves, chief executive of SmartestEnergy said: “While it is impossible to forecast with any certainty what will happen, it is clear that many in the industry are bracing themselves for significant increases.”
Mark Todd, director of Energyhelpline.com, said: “We believe dual fuel energy bills could hit £2,000 by 2020 because of the upward pressure on wholesale prices but also the need for the major suppliers to invest in green technology. Consumers need to get into the habit of shopping around.
“The figures on gas bills might even be a conservative estimate. Over the past 10 years we have seen prices go up by more than 150 per cent. That could happen again.”
Dual fuel bills are already on average £224 more expensive than last year after the Big Six providers hiked tariffs by up to 21 per cent.
The suppliers said they could no longer absorb rising wholesale costs.
Experts estimate that for every one per cent rise in energy prices, an extra 40,000 people are plunged into fuel poverty. This year’s hikes are already expected to have devastating consequences.
The Daily Express reported last month that more than 2,700 older people died over a 12-month period from illnesses caused by not being able to afford to heat their homes.
Higher energy bills and freezing weather could see the figure soar this winter.