Ofgem boss warns of energy 'rollercoaster'

Energy supplies are on a "rollercoaster" that's heading "downhill fast", the head of regulator Ofgem has warned.

Ofgem Chief Executive Alistair Buchanan told consumers and businesses to prepare for higher prices as power plants close, foreign gas supplies shrink and increasing demand tightens the British energy market.

File photo of a £10 note burning on a gas hob.
Ofgem Chief Executive Alistair Buchanan has warned energy prices are set to rise. Credit: Rui Vieira/PA Wire

Writing in The Daily Telegraph, Mr Buchanan said, "We have to face the likelihood that avoiding power shortages will also carry a price".

"If you can imagine a ride on a rollercoaster at a fairground, then this winter we are at the top of the circuit and we head downhill - fast," he continued. "Within three years we will see reserve margin of generation fall from below 14 percent to below five percent".

"That is uncomfortably tight", Mr Buchanan added.

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Rising energy bills warning

Energy bills are set to rise because Britain will become more reliant on energy imports to fill a shortfall in domestic production, the industry watchdog has warned. Ofgem said supplies are on a "rollercoaster" and heading "downhill fast".