One of the most important factors to have played a role in the rising prices of UK domestic utilities is the global economic crisis. The economic crisis that hit the economies all around the globe in 2008 caused severe consequences. The worst-hit was got by the oil prices and this economic crisis pushed most of the world towards fuel poverty. According to economic experts, oil prices would remain high or increase even further as the economies recover from the economic crisis. Due to inflation and parallel rise in oil prices, the costs of producing energy have increased significantly and this may be one valid reason for the excessive price hikes in the recent past (Caste Cover).
This has created such a dilemma in the UK domestic utility market. Customers are facing steep price increases while the companies are dealing with squeezing supplies and increasing costs. Extraordinary measures have also been proposed like budget cuts through simplifying the administrative processes in the companies and by lay off of some of the workforce. Government intervention has also been sought in order to ensure that the supply of the fuel remains secure so that the oil and gas companies remain capable of producing the required quantity of utilities.
However, according to experts, government intervention will have little impact on the overall prices of the utilities. The utility industry all around the globe is often criticized for being responsible for global warming. The consumption of fossil fuels and other natural resources are said to have caused an increase in greenhouse gases in the atmosphere which is the leading cause of the changing climate.
The regulatory authorities have taken notice of this criticism and they have introduced new regulations that require the gas and oil companies to properly dispose of their waste and to take active steps to cause minimum damage to the environment. These new requirements by the regulatory authorities cost a significant amount to the companies as the facilities required to carry out operations in conformity with the regulatory requirements are very costly.
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