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BBC’s Ros Atkins breaks down 3 key factors behind energy bills hike ‘Wholesale’s gone up!’

Ros Atkins on why energy bills are rising

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BBC Outside Source host Ros Atkins broke down the reasons why Ofgem have increased the price of energy by 50 percent across the UK. The British energy supplier has faced outrage from the Brits due to the early announcement from them of increased prices. Many Brits cannot afford the increase in energy bills, which comes just days after Prime Minister Boris Johnson and Rishi Sunak confirmed the increase in national insurance by 1.25 percent.

Mr Atkins said: “Those energy prices are rising primarily because the wholesale cost has gone up.

That has happened because global gas supplies are down.

“And there are several reasons for that, First, Europe was unusually cold last winter that meant a lot of stored gas was used up.

“Second replenishing those stores has made it harder by low wind speeds, that meant less wind power.

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Mr Atkins said: “And so more gas had to be burned to make electricity.

“The third reason is there was more demand for gas from Asia and particularly China.

“Prices are up for gas, prices are up for petrol and diesel too.” 

In response to the announcement from Ofgem, the Office of National Statistics weighed in to talk about the effects of poverty on Brits.

ONS said: “Energy price rises are likely to hit lower-income households disproportionately, as they spend a higher proportion of their income on utility bills and are more likely to be in fuel poverty.”

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Chancellor of the Exchequer Rishi Sunak addressed the House of Commons on the energy hike Thursday to announce the extension of the Warm Home Discount scheme.

Mr Sunak said: “We’ll go ahead with existing plans to expand eligibility for the Warm Home Discount by almost a third. Three million vulnerable households will now benefit from that scheme.”

Mr Sunak also said: “For all the progress we are making, the job is not yet done. We will help people deal with one of the biggest costs they now face – energy.

“Without Government intervention, this would be very tough for millions of hard-working families. 

“The Government is going to step in to help people manage those extra costs.”

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Ofgem’s chief executive Jonathan Brearley said: “We know this rise will be extremely worrying for many people, especially those who are struggling to make ends meet, and Ofgem will ensure energy companies support their customers in any way they can.

“The energy market has faced a huge challenge due to the unprecedented increase in global gas prices, a once in a 30-year event, and Ofgem’s role as energy regulator is to ensure that, under the price cap, energy companies can only charge a fair price based on the true cost of supplying electricity and gas.

“Ofgem is working to stabilise the market and over the longer term to diversify our sources of energy which will help protect customers from similar price shocks in the future.”

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