Wholesale gas prices reach record high
The British day-ahead contract rose by £0.41, or 14.7%, to a new all-time high of £3.20 /therm this morning. Prices have surged due to low gas stocks, lower supply from Russia, colder temperatures, lower wind output, and lower generation from some French nuclear plants due to a strike.
Energy market experts said the surge in energy prices this year shows no signs of abating.
UK households are already facing rising energy costs after the energy price cap went up from £1,138 to £1,277 on 1 October.
Rising wholesale prices have led to an increasing number of energy companies going bust. Utility Point, People’s Energy, PfP Energy and MoneyPlus Energy, which collectively supplied more than half a million domestic customers, all ceased trading in early September. The past month has also seen Avro Energy and Green crash out of the market, followed by Igloo Energy, Enstroga and Symbio Energy.
Ofgem has warned that more energy firms could go out of business in the coming months.
Myron Jobson, personal finance campaigner at Interactive Investor, said: “The energy crisis is heating up as UK wholesale gas prices surge to record highs. Energy providers are dropping like flies as the sector continues to battle an unprecedented rise in the cost of wholesale gas, with prices rising well above levels many suppliers could pass on to customers.
“The harsh reality is scores of customers of failed energy firms will be moved automatically onto new, and invariably more expensive, tariffs. More broadly, the prospect of higher energy bills is a huge worry for people on the financial cliff edge, and with the £20 uplift to Universal Credit and Working Tax credits coming to an end, the nation’s most vulnerable face the dilemma of choosing between heating or eating this winter.”