Uswitch publishes Energy Crisis Plan

Uswitch research has found that a third of households feel anxious about paying their energy bills, and 44% say knowing what help is available will help them prepare for the hikes.

With the Conservative leadership candidates now whittled down to two, Uswitch is calling on Rishi Sunak and Liz Truss to sit down with Boris Johnson to agree the following points:

• Based on current price cap level predictions, all customer support needs to be raised from £400 to at least £600. The government and suppliers need to be clear exactly how this will be delivered so that customers can budget. An effective way of doing this would be to pay £100 a month, direct to bills between October 2022 and March 2023. This should be communicated at the same time as the next Ofgem cap announcement.

• There should be a new vulnerable customer payment of £300 made in January 2023 (in addition to the payments already planned for July and October).

• There should be a supplier moratorium on forced prepayment installation over winter. This would reduce the risk of disconnection at the time prices are highest.

Regardless of which candidate wins the leadership contest and becomes the next Prime Minister, Uswitch believes that they must both commit to the implementation of these initiatives now so customers can gain a measure of confidence when it comes to their winter energy use.

Long-term action

With the October price cap a watershed moment, Uswitch is also asking the government to commit to long-term measures. Real change and progress for the UK energy market can be achieved by:

• Reforming how electricity prices are set so they are less impacted by the price of fossil fuels like gas - this would ensure suppliers can buy energy more affordably and then pass on the lower cost to customers.

• Acknowledging that insulation in UK households is largely not up to scratch - treat it like a national emergency and make real progress before the winter of 2023.

• Stimulating competition by reducing protections for remaining energy suppliers in order to ensure customers receive a higher level of service and more competitive prices.

Richard Neudegg, Uswitch’s Director of Regulation, said: “It is absolutely clear that urgent measures are needed to get everyone through this winter, while a long-term roadmap for how policymakers might solve the crisis is put in place.

“The government did the right thing by stepping in with wide-reaching support to try to help ease the blow. However, this support now looks like a severe under-estimation of what consumers need.

“We are suggesting the planned £400 energy bill support should rise to at least £600 for all customers to reflect the new reality, while payments to vulnerable households should increase from £650 to £950, with the extra £300 to be paid in January, when energy use is highest.

“Households need clarity to help them plan for the most expensive winter in living memory. If the cap ends up being at the higher end of predictions, the support should reflect that and increase proportionately.

“This winter, suppliers should commit to stopping forced installations of prepayment meters for customers who are struggling to pay their bills. For those in vulnerable households, the lights must stay on this Christmas.

“The country simply cannot wait for the new Prime Minister to be selected. We call on both Rishi Sunak and Liz Truss to urgently work together and agree on extra energy bill support before the new price cap level is announced on 26 August.”