The UK households find themselves caught in a severe financial crisis owing to the imminent hike in energy prices across the country, thanks to rising gas prices in the wholesale market.
According to the news on Telegraph, the decision of raising charges by Npower, one of the leading power suppliers, is expected to push the average household energy bill in the UK to record ₤1,000 per year.
With over 10% increase being introduced, annual gas and electricity bills for over four million homes will shoot up by as much as ₤180. Industry analysts opine that the trend will spread to other energy companies as well, resulting in similar hikes for the rest of the 22 Million homes in the country.
Npower blames the increases on the escalating gas prices in the wholesale market triggered by rising oil prices that reached a record high of $100 a barrel. The primary cause for the price hike is the cold weather forcing Britain to turn to Europe for gas imports during the first week of January 2008. Even wholesale prices have surged as more and more European firms turned to the comparatively liberal UK market for supplies as a cost effective alternative.
The credit crisis has been a cause for worry for consumers who are grappling with serious post-Christmas financial crunch, solid mortgage payments, higher food bills and record petrol prices. Consumers find the price hike unfair arguing that the inefficiency of the gas market is taking its toll on families. The lives of the British people are being adversely affected with dismal housing conditions and meager incomes compelling them to compromise on warmth and comfort.
The cause of the consumer is being taken up by local suppliers with the contention that the significant increase in wholesale energy prices during the winter months from December 2007 to January 2008 has always been in winter. Consumers are thus twice as unfortunate.
A RNCOS Research Analyst feels that the imminent increases in energy prices would bring harsh times for the UK consumers. It reveals the desperation of the UK energy suppliers to resort to price hikes. For the consumer to continue with high energy prices, the convenient option lies in using alternative energy. By doing so, they can cope with the price crisis as well as conform to the environmental concerns in the UK.
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