Most UK citizens today face multiple challenges, with two challenges — falling apart of the energy market and the Omicron health scare — so severe that they have instilled fear and distrust in their minds. Some facts about the energy market in the UK will make you raise your hands in dismay.
Omicron is spreading its tentacles in the UK, causing citizens another round of dismay and hopelessness. Another severe matter is that more than four million Brits find themselves displaced as energy consumers due to the collapse of the energy market in 2021.
By December first week in 2021, 28 energy suppliers had gone bust in the UK energy market, creating chaos and turmoil. The year has been turbulent for both energy suppliers and consumers in the UK.
The prime reason for this dismay has been the rising cost of energy. The unprecedented increase in wholesale natural gas prices has resulted in the energy crisis, negatively impacting suppliers and displacing millions of energy customers.
There is also a significant challenge for energy suppliers in the form of an energy price cap. As a result of this cap, the energy supplier has to stick within the rate cap in charging per unit of gas and electricity.
If there is average energy usage at your end in your house, you would know that the energy price cap is set at £1,277 per year. However, news reports say that the government may review this energy cap in February 2022. Energy market experts predict that the government could raise the energy cap to £1,600 per year. You could end up paying more from next year.
Depressing UK Energy Market Facts
1-In the past four years, from 2018 till 2021, 40 energy suppliers have gone bust and disintegrated. The falling apart of the energy companies has resulted in a total displacement of more than 5.5 million energy consumers in the UK.
2-The energy crisis management team in the government is focusing on the survival and protection of the households in this energy market crash. The small energy companies have been left to fend for themselves. The government has no plans to bail out struggling energy suppliers.
3-The record rise in global gas and electricity prices has forced small energy operators to fold up their businesses.
4-There were 70 energy suppliers in the UK energy market at the start of 2021. Energy experts say that only ten suppliers may be left standing in the market before the end of winter.
5-The government is conducting crisis talks with the UK’s biggest energy companies in the same manner, they were doing with companies during the COVID-19 pandemic. It is another matter that the government has to handle both Omicron and the energy crisis at the same time now.
6-Smaller energy suppliers do not have the sound financial backing of investors, due to which they try and cut corners. This action results in poor customer service and consumer hassles.
You may or may not have been displaced as an energy customer due to the volatility in the UK energy market. But the energy regulator Ofgem placed all displaced customers into a scheme so that their energy supply did not get cut off.
Here’s wishing a safe and happy winter to you.
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