The 80% rise in the U.K.'s cap for consumer electricity and natural gas bills this fall will drive millions of households into energy poverty this winter as the worsening cost-of-living crisis stokes fears of recession.
All the chatter today among British people is energy regulator Ofgem's rise in the cap on power bills to a record £3,549 ($4,189) beginning Oct. 1 from £1,971 ($2,330) at present. That cap is expected to rise to £5,439 ($6,427) by January and £7,272 ($8,594) by spring -- all due to skyrocketing wholesale NatGas and electricity prices caused by
declining Russian energy supplies to Europe, made worse by Western sanctions that have backfired. ..........................
The higher cap rate could push inflation to even more elevated levels as U.K. economists at Citi warned CPI inflation could reach a mindboggling 18.6% print in January due to soaring energy prices.
The last time CPI printed above 18% was during the stagflationary years of the mid-1970s (more precisely, 1976) after an oil supply shock led to soaring energy prices worldwide.
Currently, the CPI stands at 10.1% in July for the first time in four decades, primarily driven by skyrocketing food and fuel prices as households crumble under the weight of the cost of living crisis.
Inflation at decades highs has pushed U.K. Misery Index, an economic indicator to gauge how the average person is doing, to three-decade highs, a sign discontent is emerging.
"It's going to be horrendous," said Bill Bullen, chief executive officer of Utilita Energy Ltd., which supplies 810,000 homes in the U.K. "We are going to see a big increase in people struggling to pay for their energy bills."
Last winter's cap was £1,277, but that was before European leaders sanctioned the hell out of Moscow for the invasion of Ukraine. With the cold season just a few short months away, power prices are already at record highs as Russia's Nord Stream 1 NatGas pipeline to the bloc experiences supply disruptions.
UK NatGas prices are also hyperinflating.
This winter could be one of the darkest in decades for U.K. households
https://www.zerohedge.com/commodities/uk-passed-debt-and-death-sentence-million-increasing-energy-price-cap-80