Saturday 10 December 2022
Select a region
News

Families should prepare for average energy bills of £2,500+ a year

Families should prepare for average energy bills of £2,500+ a year

Tuesday 13 September 2022

Families should prepare for average energy bills of £2,500+ a year

Tuesday 13 September 2022


The average household energy bill in Guernsey is soon forecast to be between 20% and 25% higher than it was this time last year.

The Policy & Resources Committee estimates that in September 2021 the average household was paying £2,057 annually for electricity, gas and domestic heating oil - but will be paying between £2,466 and £2,589 by December 2022.

This means that the average household energy bill in Guernsey this winter - and possibly for years to come - is likely to be in line with or greater than the average household energy bill in the UK after new Prime Minister Liz Truss announced that her Government would borrow an estimated £150billion to cap such bills at £2,500 a year until 2024.

The Committee said its forecasts "are subject to a very high degree of uncertainty and should be treated with a high level of caution".

Deputy Gavin St. Pier, who submitted the written questions which prompted the release of the forecasts, said the figures were "very comprehensive and useful" as an indicator of the pressure on many thousands of local households' budgets this winter and beyond. 

Deputies Gavin St Pier & Peter Ferbrache

Pictured: Deputy Gavin St. Pier (left) asked questions of Deputy Peter Ferbrache (right) to establish estimated energy bills this winter.

Before Ms Truss' announcement of a new price cap, some energy market experts were forecasting that household bills in the UK could rise to more than £4,000 annually this winter.

The Policy & Resources Committee's replies to Deputy St. Pier also set out reasons why energy prices in Guernsey are expected to remain lower than they would have been in the UK without the Government's price cap despite the States having announced no comparable plans to help most households with energy costs.

The reasons include the island's cable link to France, which supplies energy from renewable sources and suffers from price fluctuations less than oil and gas prices; the greater use of LPG gas rather than natural gas; and the greater use of domestic heating oil, the price of which has recently fallen from its peak.

Guernsey Electricity said that its price fixing strategy is keeping costs down for local consumers. 

wind_turbines.jpg

Pictured: Guernsey's supply of power from the European grid has helped protect the island from the full force of fluctuations in the price of oil and gas in recent months. 

The Committee also explained how it estimated households' energy costs.

"These are calculated by taking the average energy costs determined in the 2018/19 household expenditure survey and inflating these costs by item specific price indices, used within the calculation of the retail prices indices," it said.

"Forecasts are produced using a combination of price rises already announced, i.e. the increase in electricity prices applied from 1 July, and expectations of price rises based on global forecasts of oil and gas prices.

"There is a significant degree of uncertainty around the future price rises, particularly in the current climate, and the reality may prove very different from the forecasts."

READ MORE...

Energy concerns dominate debate

Deputy wants islanders protected from waste and electricity price rises 

Electricity prices to go up on 1 July

Sign up to newsletter

 

Comments

Once your comment has been submitted, it won’t appear immediately. There is no need to submit it more than once. Comments are published at the discretion of Bailiwick Publishing, and will include your username.

There are no comments for this article.

To place a comment please login

You have landed on the Bailiwick Express website, however it appears you are based in . Would you like to stay on the site, or visit the site?