Bills expected to rise because of energy supply crunch

Households have been braced for yet more energy bill hikes after regulator Ofgem warned Britain was heading for a “horrendous” supply crunch.

Alistair Buchanan, its outgoing chief executive, said the UK was facing an “uncomfortable” squeeze in energy reserves over the next three years as ageing power plants close and the country is forced to import gas at a time of tightening global supply.

With coal and oil-fired power stations closing earlier than expected to meet environmental targets, around 10% of generation stock will go by April.

Within three years, the reserve margin of generation will fall from around 15% to below 5%.

Mr Buchanan said: “We’ve got to go shopping around the world for our gas.

“It’s just horrendous serendipity that just as we have a squeeze on our power and turn to gas, the global markets have a squeeze.”