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Highlights:
- Energy bills could reach £2900 after the energy cap is revised again in October; Scottish Power CEO Keith Anderson has warned.
- Anderson said that the most vulnerable, like those on universal credit or with pre-payment plans, require targeted support.
People in the UK are struggling to deal with the high cost of living crisis as the food prices and energy bills have skyrocketed. The government had raised the cap on energy prices earlier this year, which came into effect on 1 April and had put additional pressure on household budgets. The cap, which now stands at £1,971, means that the energy bill for an average UK household will rise by £693 a year. The prices will increase even further later this year when the energy cap is set to be revised again in October.
The energy bills could rise to as much as £2,900 by the end of this year, the top executive of one of the UK’s biggest energy suppliers has now warned. Keith Anderson, the CEO of Scottish Power has said that the government needs to provide a discount of £1,000 to people, five times the £200 rebate it has currently proposed, to bring the bills closer to an amount which is 'realistic' to be expected from the people to be paid.
Image source: © 2022 Kalkine Media®
Anderson said that a mechanism should be put in place urgently to help people deal with soaring bills after October. The most vulnerable, like those on universal credit or with pre-payment plans, require targeted support, he added.
Notably, the government has announced up to £350 discounts on electricity bills to millions of UK households. While all electricity consumers will be offered a £200 rebate from October that will have to be paid back over the next five years starting 2023, there will be an additional £150 rebate for those in council tax bands A-D, which will not need to be repaid.
Amid Anderson's warning of a further rise in bills, let us take a look at some FTSE-listed electricity and gas utility stocks and their performance.
National Grid Plc (LON: NG.)
National Grid is a London-based electricity and gas utility company that operates in the UK and the US. Last month, the company raised its previous profit forecasts for the year ended 31 March 2022 due to the rise in energy prices.
Shares of the FTSE 100 constituent closed at GBX 1,179.00 on 9 May 2022. National Grid holds a market cap of £42,993.42 at present, and it has given a return of over 26.54% to its investors over the past one year.
SSE Plc (LON: SSE)
SSE is a multinational energy company engaged in the business of power generation, transmission, and distribution. It operates in three segments, including wholesale, retail, and networks. In April, its renewable energy subsidiary SSE Renewables announced a deal with Siemens Gamesa Renewable Energy (SGRE) for the acquisition of its European renewable energy development platform.
SSE Plc has a market capitalisation of £19,266.14 million, and it is listed on the FTSE 100 index. Its shares closed at GBX 1,804.50 on 9 May 2022. The shares have given decent returns of 21.31% to the shareholders over the past one year.
ContourGlobal Plc (LON: GLO)
The British power generation business has a presence in 20 countries across the world and operates a total of 138 conventional & innovative power plants.
ContourGlobal has a market capitalisation of £1,238.79 million, and its shares closed at GBX 188.80 on 9 May 2022. Over the past one year, the share price has declined by 5.60%.
Note: The above content constitutes a very preliminary observation or view based on market trends and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.
