Energy providers are calling for urgent government intervention to tackle a “nationwide crisis” because of rising gas prices.
In recent months, wholesale gas prices, energy suppliers have collapsed and many have seen a hike in energy bills.
Good Energy, EDF and trade body Energy UK are among those calling for immediate action.
Chief executive of Energy UK, Emma Pinchbeck, told BBC Radio 4’s Today programme there was a “nationwide crisis” because, she said, the prices were now so high, it was affecting the whole economy.
Ms Pinchbeck told the Financial Times that, even though governments across Europe had already addressed the issue, the UK was yet to respond.
“In the UK, the energy sector is still asking if the chancellor knows that energy bills going up by over 50% in the New Year is a problem for ordinary people, businesses and the economy,” she said.
Nigel Pocklington, chief executive of Good Energy, described the situation in similar terms.
He also told the FT: “This is a national crisis. Wholesale gas and power prices have increased to unprecedented levels over the last three weeks, creating an extremely difficult operating environment for every business in the industry.”
EDF Energy, meanwhile, told the FT the situation was now “critical” and urged the government to “act now to support energy customers”.
Over 24 suppliers collapsed
Since September, more than two dozen energy suppliers have collapsed.
This included Bulb, the UK’s seventh biggest energy supplier with 1.7 million customers.
Soaring prices have forced suppliers to provide energy at a significant loss.
Industry experts have pointed the blame at the energy price cap, which is currently set every six months.
Price cap suggestions offered
Ofgem has made suggestions to help solve the issues created by the price cap in extreme circumstances.
One solution considered by the energy regulator is to review the price cap every three months as opposed to every six.
Another proposal was to overhaul the system entirely and introduce a six-month fixed tariff.