Andy Burnham urged to protect poorest households as Britain braces for worst winter energy crisis in years

Energy UK, which represents the country’s energy suppliers, has called on Andy Burnham to provide additional support for the poorest households, while maintaining efforts to reduce charges and levies included in energy bills.

The organisation estimates the typical household energy bill could climb to about £2,100 per year at the beginning of 2027.

This would be comparable with a £2,500 annual bill in 2022, when Russia’s invasion of Ukraine triggered a major disruption to European gas supplies, and prompted the Government to introduce the Energy Price Guarantee.

The prospect of another substantial increase has intensified pressure on the Prime Minister to take further steps to shield families from rising costs.

Mr Burnham has promised to provide households with “breathing space” in the Budget later this month, following his decision to cut VAT on energy bills.

Dhara Vyas, chief executive of Energy UK, said the Government needed to learn from the previous energy crisis, rather than wait for conditions to deteriorate further.

Ms Vyas said: “We cannot afford to wait for the same scale of crisis before acting again. We must heed the lessons from that time.

“The Government must act now to prevent this situation getting worse and causing even more problems over the longer term.

"Last-minute emergency interventions run the risk of being badly targeted and costing us all more.”

Energy UK said changes in household consumption mean that today's £2,100 annual bill would have a similar impact on household finances to a £2,500 bill in 2022-23.

During that earlier crisis, Liz Truss, then-prime minister, introduced the Energy Price Guarantee, limiting the typical household energy bill to £2,500.

The scheme subsequently faced criticism because it was not means-tested, allowing households across the income spectrum to benefit. The policy was estimated to have cost the Treasury £24.8bn.

The latest pressure on prices comes after prolonged disruption to gas supplies linked to the conflict in the Middle East.

Seven months of instability have contributed to declining gas storage levels across Europe as countries prepare for the colder months.

Energy UK estimates the typical household energy bill could climb to about £2,100 per year at the beginning of 2027

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Rebuilding those reserves is expected to take time, raising the possibility that elevated energy costs could persist into the spring, rather than easing quickly after winter.

In July, Mr Burnham announced plans to remove VAT from electricity bills, a measure expected to save the average household about £45 a year.

The change took effect on Thursday, but is due to end in April 2027.

Further to this, the Government has also already removed several green levies from household electricity bills.

The measures, introduced earlier this year under Sir Keir Starmer, are expected to reduce the typical annual bill by approximately £150.

Miatta Fahnbulleh, the Energy Secretary, said the Government remained focused on finding further ways to reduce the immediate burden on households, while pursuing longer-term reforms to the energy system.

She said: “We continue to look at what more we can do to protect families from unaffordable bills, as we drive down bills for good through clean power.”