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Hard Brexit will make heating your home even more expensive

Still Life of Burning Gas Cooker with Black Background. Photo by: Torri Leo/AGF/UIG via Getty Images

Heating your home could become even more expensive if Britain leaves the European Union with no deal.

A hard Brexit would add £61 ($77.73) to every consumer’s combined gas and electricity bill due to an assumed £1.5bn increase in the price of utilities, says a new report from University College London.

How electricity and gas bills would change after a new exchange rate depreciation that would bring to parity between Sterling and Euro. Table: UCL

The increase would come as a result of a further fall of the pound against the euro, should the pound fall to parity with the euro. With the euro valued at 1.14 pounds on 3 November 2018, it would take a further 12% reduction in the value of the pound to reach parity between the currencies.

Consumers have already seen a £2bn rise in the cost of utility bills in 2017 — a result of the pound falling against both the US dollar and the euro. Wholesale prices of gas (up 16%) and electricity (18%) both rose in the 12 months following the referendum, adding £74.76 to the average bill for electricity and gas combined.

Calculations showing how electricity and gas bills changed after the referendum exchange rate depreciation. Table: UCL

Utility prices have been a political battleground since Ed Miliband, then Labour leader, first announced his wish to cap utility company prices in March 2014. Three years later in April 2017 the Conservative party included their own proposed cap in their manifesto, and passed legislation in July this year allowing Ofgem to set a price cap.