Energy prices to remain sky high for years, experts warn

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Many people are struggling to pay their energy bills. (Getty)
Many people are struggling to pay their energy bills. (Getty)

Energy bills are set to remain at sky-high prices for years new analysis has shown, as many Brits struggle to make ends meet during the cost of living crisis.

Analysis by Cornwall Insight’s found the generally held view that energy prices will go down into 2021 next year sharply after the big increases this year was no longer accurate.

They said prices will not fall until 2024.

The analysis comes amid the tightest squeeze on incomes since records began.

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Wide angle image depicting a senior man's hand holding an energy bill while the other hand checks the numbers on a calculator. The table is strewn with documents and also a laptop. Room for copy space.
The rise in energy bills is being combined with a rise in the price of all essentials. (Gett)

The Office for National Statistics (ONS) said Consumer Prices Index (CPI) inflation rose 7% in the year to March, up from 6.2% in February.

It was once more the highest point since March 1992, when inflation stood at 7.1%.

The rise was higher than the 6.7% that analysts had expected and was driven by fuel, restaurant and food prices, dealing an added blow to households.

Jack Leslie, senior economist at the Resolution Foundation think tank said: "Britain’s cost-of-living crisis – on track to be the biggest squeeze since the mid-70s – will continue to worsen before it starts to ease at some point next year."

Joanna Elson, chief executive of the Money Advice Trust, the charity behind the National Debtline, said many households are already buckling under rising costs.

“One in eight UK adults say they have already gone without heating, water or electricity in the last three months,” she said.

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“With energy, food and fuel price rises showing no signs of easing, and national insurance increases hitting pay packets for the first time this month, there is no respite in sight."

The inflation crisis started before the war in Ukraine, but it has turned a bad situation into a worse one.

The sky-high energy prices in Europe have been further impacted by the sanctions placed on Russia and the Kremlin's retaliatory measures.

Ukraine and Russia are also the world's largest producers of sunflower oil, which has led to a sharp increase in the price of cooking fats, which in turn is driving up the price of food.

Lamb that is eaten across the country this weekend will cost around 16% more than last Easter.

Things are only set to get worse over the next few months.

Cornwall Insight’s analysis predicted prices would not fall soon but they also predicted energy costs would continue to rise sharply throughout this year.

Dr Craig Lowrey, Principle Consultant at Cornwall Insight said: "In the space of just two weeks, predictions for the price cap levels due in the Summer and Winter of 2023 have jumped by over £200 a year for an average household."

The price cap rose by more than 50% in February, which came into force this month.

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