E.On boss warns 40% of customers could fall into fuel poverty

More and more people are falling behind with their energy bills, E.On's boss has said. Credit: PA

The energy supplier E.On has predicted that 40 per cent of its customers will be in fuel poverty by this Autumn.

Its chief executive warned that more and more people are falling behind with their energy bills and called the rise in energy prices "unprecedented."

Michael Lewis called on the government to “tax those with the broadest shoulders”, when asked about whether a windfall tax should be introduced to battle the energy crisis.

He told BBC One’s Sunday Morning TV show: “Well, for us, the most important thing is that the government intervenes, it’s up to the government to decide how they fund that.

“All I would say is that it’s important that, when they are taxing to address this challenge, that they tax those with the broadest shoulders.”

Mr Lewis spoke about the growing number of customers who are falling into fuel poverty, which will only worsen later in the year.

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He said: “We are seeing a significant number of people in fuel poverty, that is to say more than 10% of their disposable income spent on energy, and that’s risen to around 20%, and in October our model suggests that it could rise to 40% if the government doesn’t intervene in some way.”

Approximately one million of the eight million accounts with E.ON in the UK are already in some kind of arrears, which Mr Lewis says they expect to rise by 50% come October.

He also said that an increase in Universal Credit would “absolutely” help “people at the bottom of the income range who are most adversely affected by this.”

Could there be a windfall tax?

Meanwhile, the government has not ruled out imposing a windfall tax on energy companies despite strong opposition from several ministers.

Education Secretary Nadhim Zahawi has said the Cabinet is considering “all the options” to combat the cost-of-living crisis, including a one-off levy on firms which have benefited from globally high gas and oil prices.

Chancellor Rishi Sunak has not ruled out imposing a windfall tax on energy producers, but ministers including Anne-Marie Trevelyan, Brandon Lewis, Sajid Javid and Jacob Rees-Mogg have criticised the measure as ineffective.

Nadhim Zahawi said the Cabinet was considering ‘every option’ to alleviate the cost-of-living crisis. Credit: PA

When asked about imposing a windfall tax by Sky’s Sophy Ridge on Sunday, Mr Zahawi said: “We will look at all the options.

“I with the chancellor, prime minister and cabinet will look at every option.”

But he spoke about the impact this could have on elderly people, adding: “If you apply a windfall tax, (companies) will probably have to reduce or take away their dividend.

“Who receives the dividend? Pensioners through their pension funds.

“Investment has to be real, which is what I think Rishi (Sunak) will demand of all these companies and to see a roadmap towards that investment. We’re not taking any options off the table.”

I’m worried by these rises, what support is available?

If you are on a low income or claim pension credit, you may eligible for Warm Home Discount through your supplier.

This cuts bills with a one-off discount of £140 at some point between September and March - which will be take off your bill rather than paid directly to you.

You must contact your supplier to confirm your eligibility and apply, though the number of discounts a supplier can give is limited.

If you fall behind on payments, there are suppliers that offer grants. Citizen's Advice Bureau (CAB) lists suppliers that offer grants:

If none of these companies supplies your energy, you can still apply for a grant though British Gas Energy Trust as you do not need to be a customer.

Applications can be time consuming. For help, CAB advises to reach out to one of its advisers or to contact Money Helper.

Meanwhile, Simple Energy Advice offers a tool on its website to locate grants available in your specific area.

Your local council may also provide various grants.