A campaign is under way to close an energy price cap loophole that leaves hundreds of thousands of UK customers facing soaring bills. The push is being led by a Midlands-based energy consultancy that says thousands of its customers are affected – but across the UK, there could be around half a million. People living in apartment blocks where the owner has chosen a communal energy supply are not covered by the price cap. This is because the energy supply is deemed by energy companies to be ‘commercial’ rather than ‘domestic.’
While wholesale prices continue to climb steeply, the UK’s price cap on energy bills stops companies from immediately passing those costs on to their domestic customers – with no such protection for commercial costs. A commercial classification applies to electricity supply in a block where there is only one supplier meter as well as a more modern gas-powered communal system known as a ‘heating network’ adopted in newer properties for its lower carbon technology.
While the Government has set a target for five million homes to be part of a heat network by 2050, such properties are not subject to the price cap which was set by industry regulator Ofgem on October 1st and is currently set to end in April this year. And because the supply is communal, residents’ hands are tied. It’s the property block owner rather than those living in it who agrees the energy – then recharges residents. Responsible block owners have a duty to find the best value rates but with rising energy costs and the recent price cap not applying to their premises, residents are missing out. Birmingham-based Ginger Energy, which operates across the UK, is calling on regulatory body Ofgem to urgently review the situation as well as urging those affected to write to their MP and complete this petition on line.