Keep Us Warm This Winter campaign: Blackpool families face financial hardship with double blow of high energy bills and Universal Credit cuts, charities warn
The threat of soaring fuel prices could leave many families with the dilemma of eating or heating their homes this winter.
Today, the Gazette joins its sister JPI Media publications throughout the UK in calling on the Government to make sure no-one suffers from the crisis.
We want assurances that every family will be able to afford to heat their homes this winter and that the lights stay on.
During the coming weeks our Keep Us Warm This Winter campaign will keep up the pressure to make sure everyone - including the most vulnerable - is protected.
The price of wholesale gas has surged by 250 per cent since the beginning of the year, and an added 70 per cent since just August, according to figures from Oil & Gas UK.
The soar in prices comes as the economy opens up from its Covid lows, demand for gas in Asia grows, and several gas platforms in the North Sea have closed to perform maintenance that was paused during the pandemic.
According to Bloomberg, calmer wind speeds during the past month has meant more gas has been needed to produce electricity, after output was cut from some 11,000 wind turbines in the UK - responsible for around 20 per cent of electricity production.
Energy regulator Ofgem said consumers can expect an average price rise of £135 this winter.
The price hikes could force some resort families over the poverty line, and letters from providers are already landing on doormats bearing the bad news.
Suzanne Mellon, 34, from Grange Park, is in receipt of Statutory Sick Pay while suffering the effects of Long Covid, after she was hospitalised with the virus at the beginning of the summer holidays.
Suzanne, who works part-time at Layton post office, is mum to two children aged 15 and seven, and her partner is a full-time production operative - but she was worried their utility bill increase would push them into financial hardship.
She said: "We're with Shell Energy and we've just been told our bill will be going up by £40 a month for gas and electric combined.
"We're on a fixed tariff, and it might not sound like much but when you factor in that prices for everything else like food is going up, as well as this year's council tax increase, it adds up.
"We get our wages topped up by Universal Credit, and we're going to be losing that top up soon as well. That's £94 a month we're going to lose.
"We've had a look at other providers and even though our bills are going up, it's still not as bad as other companies. Now that I'm at home it's more of a struggle because I'm using more electric than I would be if I was at work.
"It's going to have to be a case of putting more jumpers on and using less heating this winter."
One of the country's biggest gas and electricity providers, British Gas, announced a 12 per cent increase to the price of its Standard Variable tariff to £1,277 in August, to come into effect on October 1.
Bispham teacher and mum-of-three Amy Moores, 33, is a British Gas customer and has just been hit with almost double her usual monthly direct debit amount for gas and electric.
Amy said: "Our fixed tariff has just ended and our bill has just gone from £55 a month to £107.
"To move to another fixed tariff now is 145 a month. We are actually better staying on the standard tariff and relying on the cap - for now.
"This is going to cripple some families, especially with it coinciding with the uplift ending. My husband and I both work full time in schools, but still earn so little we get topped up by Universal Credit.
"I'm now on maternity leave, and I'm not sure how we will afford that much extra on a reduced income. I'm dreading Christmas."
The energy crisis has prompted concerns from other Fylde coast residents, some of whom were facing struggles with paying for both heating and food as the colder months approach.
David Hamilton said: "EDF has just pushed up my monthly direct debit (dual fuel) from £150 to £230, though this is more usage related than wholesale price increases as I am on a capped rate, at least I am for a while longer.
"I guess we need to be moving away from gas heating and over to electric, and get more renewables or nuclear power stations online."
Margaret Nodell added: "[The price hike] is terrible - cold, hungry and no money. What are we doing with our pensioners? I will be hungry when the bills go up - it's either eat or heat."
Energy prices were already set to rise for the 15 million households in Great Britain that are on their supplier’s default tariff, because of a major hike in the energy price cap.
Ofgem had been criticised for the rise, which comes into force on October 1, however the price cap is now one of the better deals on the market.
Some of the country's smaller energy firms are going bust - mainly because many promised to sell gas to customers for less than it is currently costing them to buy.
If a firm does go under, its customers will automatically be moved to another provider by Ofgem.
Consumers are protected by the price cap - which will increase to £1,277 from October 1 - but Martin Lewis, founder of MoneySavingExpert.com, said he expected the price cap to "change in six months."
Mr Lewis suggested that, based on the “current run-rate”, the price cap from April 1 may be more than £1,500 a year, based on typical usage.
Fylde coast food banks were already preparing for a surge in users after the Government announced it would be cutting Universal Credit by £20 a week.
But they now say with those benefits being lost, in addition to extra money being asked of people for energy, referrals to food banks could increase even more.
Kim Cook, chairwoman of trustees of Fylde Foodbank, said she expects the number of referrals for its services to increase if the expected energy hike goes ahead.
"People may have to choose between turning off their heating or skipping meals, and many households could be plunged into hardship," she said.
Father John Hall, vicar of the parish of St David’s and St Peter’s in Fleetwood, said the town's food bank The Pantry would likely see even more people than the 200 it serves weekly at the moment.
His main concern for the town's residents was the cut to Universal Credit, and said most of the people he helps at The Pantry pay for energy through a meter.
"I think we could see a lot more people using us after the Universal Credit cut, especially when single people could be expected to live on just £50 a week," he said.
"That's our main priority at the moment - but in the coming weeks we could be getting more people realising that perhaps that £5 they put on their meters isn't lasting as long as well."
Charities have set wheels in motion to support as many people as possible across the county with advice in light of recent price increases, as they anticipate an increase in the number of consumers contacting them with debt worries.
Lancashire Women is offering a free energy advice service as part of its Budgeting, Debt & Benefits service in light of energy price hikes - providing one-to-one Zoom, phone or face-to-face appointments for all genders in the county aged 16 or over.
A spokesman for the charity said Lancashire residents can access help with Warm Home Discounts, tariff comparisons, assistance with gas and electricity debt and budgeting advice.
People who are worried about an increase in energy prices are being encouraged by debt charities to contact their suppliers as soon as possible, in a bid to prevent debits from spiralling out of control.
Jane Tully, director of external affairs and partnerships at the Money Advice Trust, the charity that runs National Debtline and Business Debtline, said: "Many people will be worrying about how they will pay their energy bills this winter, especially those already struggling to meet day to day costs.
"If you are worried about affording your energy bills or struggling to afford to top up your pre-payment meter, contact your energy supplier who may be able to help.
"If you’re on a low income or receiving benefits, you should also check to see if you’re eligible for the Warm Home Discount, which can reduce your bills during the winter months.
"I would encourage anyone worried about their finances to seek free, independent debt advice from a charity-run service like National Debtline as soon as possible. An adviser will be able to take you through your options including support that may be available."
Debt advice charity StepChange warned that millions of people across the country were already struggling to pay household bills - even before energy prices were on the rise.
Ed McDonagh, senior public policy advocate at StepChange, said: "In polling earlier this year we found that 4.3 million people were behind on household bills, 3 million of whom had experienced fall in income since the start of the pandemic.
"Some 35 per cent and 25 per cent of those who’d fallen behind on a bill were struggling with electricity and gas costs respectively, this is before the significant rise in costs we are starting to see now.
"Any further rise in price, particularly in combination with the £20 weekly cut to universal credit, threatens to push households into more difficulty and overwhelm those already struggling to pay their energy bills."
Why are energy prices increasing?
In July, Ofcom chief executive Jonathan Brearley warned UK residents that global prices for fossil fuels, especially gas, were “increasing at an unprecedented rate,” an increase of 250 per cent since the start of 2021, ultimately feeding into all customer energy bills in the UK.
Following an increase in the price cap level to £1,277, announced in February 2021, suppliers raised their prices for customers on default tariffs.
For customers paying by prepayment meter, the cap was raised to £1,309.
The surge in gas prices made fixed rate energy tariffs not covered by the price cap - as well as petrol and diesel - more expensive.
According to industry analysts, a colder winter last year resulted in depleted stocks of gas, and a higher demand for liquefied natural gas from Asia also saw prices soar.
But despite the crisis, the government said the UK “benefits from having a diverse range of gas supply sources.”
Business Secretary Kwasi Kwarteng told the House of Commons: ‘’We have sufficient capacity, to meet demand and we do not expect supply emergencies to occur this winter.”