Manx households warned of tough year ahead as energy bills rise

The first of two 15% electricity price rises is due to take effect in April

Households on the Isle of Man face a tough 12 to 18 months as energy bills soar, the treasury minister has said.

Electricity prices are due to rise by 30% by July on top of a 27.5% increase in gas tariffs, which came into force late last year.

David Ashford is set to outline financial support next month to help people meet the rising cost of living.

However, he warned the Treasury could not "insulate all households against every pressure".

The government "recognises there will be anxiety" about the impending increase, and support would not just extend to those receiving social security benefits, Mr Ashford added.

'Different pressures'

The tariff increase by Manx Utilities (MU) has been split into two instalments of 15% at the Council of Ministers' request, to allow time to assess the impact, he told the House of Keys.

The state-owned electricity provider announced in February that it had already absorbed £16m in price increases caused by rising wholesale gas prices by using its reserves.

Mr Ashford said since then MU had paid a further £1.2m from its reserves to keep costs down, with daily prices £33,000 higher than originally budgeted for.

About £1.5 million has already been spent by Treasury on supporting about 3,500 people via an expanded winter fuel bonus scheme to help with rising energy bills.

It was introduced in response to the hike in gas tariffs, which was approved in October, with the island's energy regulator warning a further increase is likely to be implemented soon.

Details of the forthcoming support have not yet been revealed, however Mr Ashford said the response would reflect "the different pressures on different households".

The measures would also be designed to avoid any "cliff edges", where people narrowly miss out on help, he added.