In what consumers are dubbing ‘the great fuel theft,’ energy firms are accused of increasing or tripling direct debits without consent.
EDF, British Gas, Bulb, and Shell Energy are among the corporations slammed online by Britons who can’t afford hundreds of pounds per month in cost-of-living increases.
Even before the energy price ceiling is removed, and despite being in the midst of one of the hottest summers in history, energy corporations have begun increasing direct debits. And victims have shared horrifying experiences online.
Unhappy customer: ‘This isn’t acceptable, @edfenergy. How can individuals afford £473 a month? £252 a month is hard to find, and you’re raising my direct debit by 88%.
An EON client whose direct debit increased to £959 from £714 on September 1 published his statement and said, “I refuse to pay it.” Despite owing £177.17, @eonenergyuk doubled my monthly direct debit…again.
Another tweeted: ‘@ShellEnergyHome why have you automatically changed my direct debit? You’ve already severely overcharged me on this month’s bill, and I haven’t consented to the change. Everyone cancels direct debits when you only modify them. Martin Lewis called soaring energy costs a ‘catastrophic’ financial disaster ‘that endanger lives’ as a new Uswitch poll found homeowners are already in debt to energy providers.
Increased energy costs
2018-£1,300
£1,353
2020-£1,295
£1,339
(House of Commons Library: household bill)
2022-01-01: £1,309
£1,971 August 2022
(Ofgem cap)
£3,582
£4,266
(Cornwall Insight)
last week’s projections
£3,359
£3,616 in Jan. 2023
Six million UK homeowners owe energy suppliers £1.3 billion, three times more than a year earlier.
Mr Lewis, who sold MoneySavingExpert.com for £87million in 2012, said: ‘For every £100 direct debit you presently pay, in October you will be paying £181, and in January you will be paying £215.’
‘That’s a devastating increase for families; millions can’t afford it. This financial emergency harms lives.
Six million UK households owe energy suppliers £1.3billion, three times more than a year ago, according to a poll.
More than 100,000 ‘energy bill martyrs,’ including a Church of England clergyman, claim they will quit paying this winter since costs might reach £5,000 by early 2023.
Don’t Pay UK, a civil disobedience movement, with tens of thousands of supporters.
Jake Cable remarked, “They can’t charge as much for energy as for rent or mortgage.”
A survey indicates mounting outrage over politicians’ unwillingness to confront a problem threatening millions of homes that would struggle to feed, light, and warm their family.
Most Britons foresee a bill or tax boycott, and a third say there’s a chance of poll tax-style demonstrations.
Furious Brits accuse energy suppliers of pressuring people to ‘gamble’ with higher fixed-rate offerings.
Customers throughout the nation say fat cat CEOs are ‘holding them to ransom’ over pricing uncertainties in the new year.
Matt Reed, 32, was upset when his energy supplier urged him to sign a $3,600-a-year deal.
He told MailOnline, “British Gas recommended I switch to a fixed rate yesterday.” I presently pay £1864, which is bad, but they want me to pay £3672!
“When will it stop? Caps prohibit price increases. It’s a farce, and something has to be done ASAP to stop these greedy businesses from stealing more money from the people.’
Liam Lewis, a Bournemouth NHS worker, would see his expenses quadruple if he signs a 12-month fixed term.
He and his part-time nurse wife Alice pay £100 a month, £60 more than last year. The couple was astonished when a fixed agreement tripled their monthly payments to £300.
The couple lives in a two-bedroom semi-detached house with their 19-month-old son Arlo. Rising costs have them unsure whether to make an expensive deal or remain put.
Liam, 38, adds, ‘We have a young family, and childcare rates have risen twice this year. Where will we acquire additional money?’
Others have complained of unexpectedly high energy bills that might bankrupt them.
Martin Tang, 62, has owned the Royal Crown Chinese takeout in Torry, Aberdeen, since the 1980s. He was shocked to receive a £10,000 gas bill for only three months.
SSE decreased this to £3,0807, including £1,429 for electricity. He’s now been given a £6,000-a-quarter deal.
‘My quarterly gas bill with SSE is just over a thousand and the electricity roughly the same,’ he told MailOnline.
‘I’ve been promised £6,000 each quarter. The government needs to intervene.
I could temporarily close the store, but the money won’t last. I have a tough job. The government must act immediately.
Ian James, 47, was charged $1,047 by Scottish Power for a fixed-rate tariff, nearly twice his current direct debit payment of $538. He won’t take the option.
Basingstoke father-of-three: ‘Not only low-income families will be impacted. My wife and I have strong jobs and incomes, but this is ludicrous. We’ll have to make cuts like everyone else.
When firms make outrageous profits while others struggle, it’s wrong.
Energy chiefs were brought to Downing Street today for an emergency meeting attended by Boris Johnson and top ministers. No strategy was reached despite concerns costs might surpass £5,000 next year and remain high for a decade.
Chancellor Nadhim Zahawi said authorities will continue to review energy businesses’ ‘exceptional earnings’ and ‘necessary and proportional actions to take’
Mr. Johnson reminded corporations that the next prime minister will make “major budgetary choices.”
The meeting concluded with vague pledges that corporations would continue ‘working together’ with the government to support suffering homes.
Mr. Zahawi is reportedly threatening to increase windfall tax to encourage energy businesses to invest in renewable energy. Michael Lewis, the £1 million-a-year CEO of E.on, Tom Glover of RWE, and Clare Harbord of Drax entered Number 11 today.
Before interest and taxes, the corporations earned £3.9bn, £2.4bn, and £225m, respectively.
Jonathan Brearley, who earns £300,000 to run Ofgem, which sets the price cap, was also present.
What fat cats eat
CEO of Centrica: £875,000
Centrica CFO Kate Ringrose: £933,000
Scottish Power CEO Keith Anderson: £1.15m
E.On’s Michael Lewis: £1m
EDF CEO Simone Rossi: £1m
Executives were requested to provide predicted earnings, rewards, and investment plans.
Rishi Sunak and Liz Truss have been asked what they would do to aid struggling families. Labour has urged for a ‘loophole’ in the oil and gas windfall tax to be plugged to collect extra support monies.
At yesterday’s energy costs, Auxilione experts predict Ofgem to set the limit at £5,038 per year for the typical home in April.
It also estimated that costs would hit £4,467 in January, £200 more than Cornwall Insight’s already bleak projection.
As families consume more gas in the winter, this projection may scare energy customers more than April’s higher amount. A typical home would spend £571 on energy in January under the worst scenario.
Average home energy usage determines the price limit. Energy utilization lowers costs. Latest predictions put gas at 18.02p per kWh and electricity at 70.34p per kWh.
The updated forecast uses today’s wholesale energy price. Tracking the wholesale pricing over months determines the ultimate price. It comes hours before ministers meet with energy corporations to discuss the coming winter.
Shell, BP, and British Gas owner Centrica’s bountiful earnings performance have angered many.
Former PM Gordon Brown supported eliminating the price restriction and engaging with energy companies.
Over 100,000 have joined a campaign to avoid paying electricity bills.
Don’t Pay UK wants a million pledges before calling for a statewide energy strike, ignoring warnings that participants risk debt, credit damage, and property repossession. Mr Johnson said after today’s meeting, ‘Countries throughout the globe feel Putin’s devastating conflict in Ukraine. We know this will be a challenging winter for people throughout the UK, therefore we must continue to help them.
After today’s discussion, we’ll maintain encouraging the electrical industry to reduce cost-of-living pressures and invest in British energy security.
How much profit do energy providers make?
Energy chiefs were brought before ministers on Thursday amid forecasts that the average family bill might rise to £5,000 from April. Energy corporations want rapid consumer aid. The price restriction on bills stops companies from overcharging for gas and electricity.
Companies are permitted £35 in Ebit per household. They passed on wholesale energy price hikes to consumers. So prices rise.
Which UK energy providers met with ministers?
BGT
British Gas has millions of clients. British Gas’ first-half operating profit plummeted 43% to £98 million in 2022. After VAT, customers pay £6.
Centrica fared better. Although the corporation is moving out of fossil fuels (it used to generate a lot from the North Sea), it still produces some oil and gas.
Adjusted operating profit was £1.3 billion, up from £262 million a year earlier due to increased wholesale fossil fuel costs. Centrica will be taxed on North Sea earnings.
E.on
E.on UK’s main business is German. In the first half of the year, the company’s UK Ebit rose 77% to 289 million euros (£245 million). Parent company earned £3.9bn.
EDF
EDF owns EDF Energy. In the first half of this year, the company’s UK Ebitda was 860 million euros (£728 million).
It was a 200% increase over the same time a year before (267 million euros). EDF’s nuclear units in the nation generated more power. Higher costs for energy supplied to enterprises benefited, while residential sales hurt.
Octoenergy
Octopus Energy is privately held and only provides yearly results. Last year, the company’s operational losses dropped from £63 million to £31 million. The energy crisis cost consumers £150 million.
ScottishPower
Iberdrola owns ScottishPower. First half of 2022 Ebitda was £924.6 million, up 2.6%. Most of it came from wind turbines and other renewable energy.
The company’s energy retail segment produced £54.3 million in Ebitda, a 60% drop.
Others
Ministers met with representatives from RWE, the German energy giant, Drax, which burns wood pellets and gas, Greencoat Capital, a renewable energy investor, Intergen, which burns gas to make electricity, Germany’s Uniper, National Grid, power generator SSE, Dutch energy firm Vitol, Denmark’s Orsted, and Energy UK.
In the following months, government assistance will include the second £324 instalment of the cost of living payment for disadvantaged families, further aid for retirees and people with disabilities, and a £400 energy bills reduction for all households.
Mr Zahawi continued, ‘This morning I convened power business executives to discuss what they can do to engage with the government and act in the country’s interest in the face of increasing costs caused by Putin’s illegitimate invasion of Ukraine.
We’ve protected 8 million of the most needy British families with £400 off energy bills and $1,200 in cash assistance. In the spirit of national togetherness, they pledged to support more needy individuals.’
Mr. Sunak has committed ‘hundreds more’ for electricity bills.
He told the BBC it would be his’moral obligation’ to assist seniors and others on welfare with bills if he became prime minister.
Ms Truss seemed to shy away from her former stance of no more ‘handouts’, telling GB News she would ‘do all I can to help working families’ if chosen prime minister.
The Foreign Secretary said she will move ‘as quickly as feasible’ with an emergency fund to support people through a harsh winter.
When asked whether she would remove VAT off energy bills to save households £210, she answered, ‘There will be an urgent budget to deal with the difficulties we confront.’ These considerations must be considered.
Miss Truss wouldn’t say how much help she’d provide, but she promised to decrease taxes to enable people retain more of their money.
Labour wants the government to fix a ‘loophole’ in the energy earnings windfall tax to assist families pay their bills.
Rachel Reeves, the shadow chancellor, claimed the Tories are giving oil and gas companies billions in tax benefits to pass on to shareholders. The government should be embarrassed of this loophole.
This isn’t right when individuals are anxious about paying expenses.
Shell, BP, and British Gas owner Centrica’s bountiful earnings performance have angered many.
Mr Brown told the Guardian that the government should ‘halt any future bill ceiling increases’ and negotiate lower rates with each firm after evaluating their financial statements.
He recommended nationalizing bankrupt suppliers.
Time waits for no one. Crisis doesn’t. Former Labour PM Tony Blair stated, ‘They don’t take vacations or gracefully hang fire to suit a leaving PM or two prospective successors.’
He said Britain should lead an emergency G20 summit to address the problem.
Mr. Brown added, ‘British ministers should also lead the way… in demanding concerted international action with an emergency G20 early in September to handle fuel, food, inflation, and debt issues.
Global challenges need internationally coordinated solutions.
Mr Brown has urged on the Tory leadership candidates to collaborate on an emergency plan with Boris Johnson. A chief at one of the UK’s leading energy businesses has joined his requests.
Philippe Commaret, EDF’s general director of consumers, said, ‘We’re urging the government and the two Conservative candidates to collaborate with industry to help people in need this winter.’
Customers must know assistance is coming. Delaying a decision would generate concern for millions of people.’
Martin Lewis, a consumer advocate, told broadcasters: ‘I agree that Boris Johnson is running a zombie administration and can’t do much, but the two contenders – one of them will be our prime minister – need to tell us the very minimum of what they would do.’
A government official stated, ‘We’re working with the electrical industry to promote changes and improve the market’
Keir? Vacationing…
Labour is under pressure to explain Sir Keir Starmer’s vacation after accusing ministers of disappearing during a crisis. Sir Keir has been absent for a week. Yesterday, a member of his frontbench team answered concerns about his return and energy bill plans.
Sky News questioned Bridget Phillipson, “Where is Keir Starmer?” She said, “Keir Starmer deserves a vacation like everyone else.” Sally Nugent questioned her on BBC Breakfast, “Where’s Keir Starmer?” Miss Phillipson stated, “We’ll hear about further steps shortly.”
Energy minister Greg Hands responded to Labour ads by saying, “Sir Keir is on vacation.” That’s OK. Why criticize the PM’s vacation from a beach lounger?’
As declared in May, the government continues to analyze the unusual profits in specific sections of the power production industry and the relevant and proportional actions to take.
Yesterday, consumer advocate Mr Lewis claimed the cost of living issue was turning into a ‘national disaster’ and accused governments of behaving like ‘zombies’
Mr Lewis, who sold MoneySavingExpert.com for £87million in 2012, said: ‘For every £100 direct debit you pay, in October you’ll pay £181 and in January you’ll pay £215, and that’s on top of the April hikes.
Millions of households won’t be able to afford this cataclysmic increase.
‘We’re confronting a financial emergency that threatens lives,’ he warned.
I agree that Boris Johnson is leading a zombie government and can’t accomplish much, but the two contenders need to tell us the very minimum of what they would do.
If they can’t agree, we need correct plans because millions of people are terrified.
Uswitch found that families are already in debt to energy providers before the price ceiling is abolished.
Six million UK homeowners owe energy suppliers £1.3 billion, three times more than a year earlier.