UK cost-of-living crisis worsens as energy price cap nearly doubles

The expected rises could leave millions unable to pay their bills, as Britain grapples with sky-high inflation that has put up the cost of living

Britain announced Friday a vast 80-percent hike in electricity and gas bills, in a dramatic worsening of the cost-of-living crisis before winter as the country awaits a new leader.

Regulator Ofgem said its energy price cap, which sets prices for consumers who are not on a fixed deal with their supplier, will in October increase to an average £3,549 ($4,197) per year from the current £1,971.

"The increase reflects the continued rise in global wholesale gas prices, which began to surge as the world unlocked from the Covid pandemic and have been driven still higher to record levels by Russia slowly switching off gas supplies to Europe," Ofgem said.

UK inflation is already in double-digits and forecast to strike 13 percent in the coming months due to runaway energy bills.

The near-doubling in the energy cap will likely tip millions into fuel poverty, forcing them to choose between heating or eating, anti-poverty experts say.

"I talk to customers regularly and I know that today's news will be very worrying for many."

The rampant cost-of-living has dominated the race between Liz Truss and Rishi Sunak to succeed Conservative Prime Minister Boris Johnson.

Household and business consumers, energy suppliers and opposition politicians said urgent action is needed to avoid putting the most vulnerable in desperate situations.

But Johnson, who has been on holiday twice in recent weeks, has promised to leave major fiscal decisions to his successor. 

Foreign Secretary Truss says she favours tax cuts over direct "handouts". 

Former finance minister Sunak has argued tax cuts will worsen inflation, instead proposing further direct support.

Leaders of devolved parliaments in Wales and Scotland have called for a freeze on the price increase.

Her Welsh counterpart Mark Drakeford backed calls from his Labour party for a freeze on bills and windfall taxes on oil and gas giants.

- 'Catastrophe' -

With many poorer households relying on more costly pre-payment meters, the foundation predicted thousands could see their energy cut off entirely. 

French energy giant EDF has urged the government to double its energy support package to Britons, with its managing director for UK customers, Philippe Commaret, telling AFP that the hike would be "catastrophic".

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