British shoppers snap up blankets, warm clothes for difficult winter

The overall value of sales rose 2.2 per cent from a year earlier, due to a sharp increase in the price of goods. PHOTO: REUTERS

LONDON - Britons took action to curtail their energy use this winter by buying blankets, warm clothing and energy-efficient appliances in response to soaring gas and electricity prices.

Consumers also cut back on big-ticket items such as computers, televisions and furniture in September, according to the latest sales survey from the British Retail Consortium (BRC).

The overall value of sales rose 2.2 per cent from a year earlier, but that was due to a sharp increase in the price of goods, the BRC said in a report on Tuesday.

The volume of sales continued to fall as households already struggling with near double-digit inflation braced for a 27 per cent increase the energy-price cap on Oct 1.

Ms Helen Dickinson, chief executive of the BRC, said rising costs and wages are making it hard for retailers to reduce prices for embattled households.

"A difficult winter looms for both retailers and consumers," Ms Dickinson warned. "Costs are increasing throughout retailers' supply chain, the pound remains weak, interest rates are rising, and a tight labour market is pushing up the cost of hiring."

The cost of living crisis was also on display in a separate survey from Barclaycard, which showed spending rose at the slowest pace since the start of last year.

Britons are also turning down the heating. Keeping the thermostat a few degrees cooler than usual could reduce residential gas consumption by as much as 23 per cent, according to a BloombergNEF forecast.

That would be enough to stave off forced rationing and carry households comfortably through the coldest of the last 30 winters, giving suppliers a bit of a cushion while seeking replacements for dwindling Russian flows.

Regulator Ofgem warned that the country faces a significant risk of gas shortages in coming months, and Britain's grid operator said there could be three-hour power cuts on cold, calm days.

About three-quarters of households are expected to make behavioural changes such as reducing the amount of time the heating is on and not using it in every room, according to modelling by financial consultant Lane Clark and Peacock (LCP).

Said university student Hannah Kinnane, 20: "With the bills going up, we're planning on keeping the heating off until at least November."

Ms Kinnane lives in the seaside city of Brighton with four family members, including her 84-year-old grandmother, who suffers from heart arrhythmia. She added: "To keep warm, we've all been congregating in the same room for three or four hours before going to bed with extra blankets."

All told, those changes could reduce energy consumption in an average household by as much as 20 per cent, said Mr Steven Ashurst, head of heat at an LCP unit.

"We are all hoping for a mild-autumn and winter heating season," he said. "People will try to manage without their heating for as long as possible."

The government so far has prioritised reducing costs for consumers over pushing conservation.

The European Union raised concerns about Britain and Germany providing billions of dollars of support for energy bills without addressing demand.

Rationing is rare in Britain, but not unknown. Three-day work weeks were introduced in the early 1970s after strikes by coal miners and railroad workers curbed power generation.

Britain is spending £130 billion (S$207 billion) to freeze the unit cost of energy for households for two years. Still, a typical domestic bill will be £2,500 a year, almost double last year's average.

Europe has a voluntary target to cut gas consumption by 15 per cent this winter, and France unveiled dozens of measures, pledges and incentives to cut energy use by 10 per cent over two years.

By comparison, Britain made no estimates, and Prime Minister Liz Truss blocked an energy-saving campaign.

Britain is spending £130 billion (S$207 billion) to freeze the unit cost of energy for households for two years. PHOTO: AFP

While using less energy helps wallets and can be pitched as part of a war effort to help punish Russia for invading Ukraine, there can be severe health effects associated with the cold.

Spending extended periods at temperatures below 15 deg C can increase the risk of serious respiratory illness, and temperatures below 14 deg C worsen cardiovascular conditions, according to the Centre for Sustainable Energy charity.

Comfortable indoor temperatures vary - depending on age, health and other factors - but the Met Office forecasting agency recommends at least 18 deg C.

"Consumers are rightly spooked by the promise of high prices, so many will choose a jumper over the thermostat," said Mr Caspian Conran, an energy markets economist at London-based consultancy Baringa Partners. He estimates that residential demand falling by 10 per cent.

With bills rising, fuel poverty campaigners warn of potentially dire consequences for the millions of households that cannot afford to pay. Cold weather contributes to about 265 deaths a month in England and Wales, according to a report published in The Lancet medical journal.

That tally could rise this year, said Mr Peter Smith, director of policy and advocacy for the National Energy Action charity.

A calamity on that scale would overwhelm a National Health Service already pushed to its breaking point by Covid-19 and tight budgets. Hospitals are not covered by the heating aid package, so they are paying tariffs that have doubled or tripled.

Spending more on energy could lead to staff reductions, longer waiting times and potential cutbacks in patient care.

But some experts say energy usage is not a zero-sum game: either turn up the heat and pay a lot or keep it off and shiver.

The most effective way to minimise power consumption during colder months is by improving insulation, said Mr Raman Bhatia, chief executive officer of Ovo Energy, noting that the average British home loses heat three times faster than those in Germany or Sweden.

He also recommended using smart-home technology to boost efficiency. Ovo, the nation's third-biggest household supplier, is training customer-service agents to offer more advice and audit homes.

"Small changes in consumer behaviour could account for substantial changes in the gas balance," said Mr Stefan Ulrich, a European gas analyst at BloombergNEF.


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