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British water company Pennon Group on Friday forecast its annual power costs to be almost double from a year ago, as the deteriorating energy crisis in the country dents business and household budgets.

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Sept 30 (Reuters)British water company Pennon Group PNN.L on Friday forecast its annual power costs to be almost double from a year ago, as the deteriorating energy crisis in the country dents business and household budgets.

The company expects total power costs across the group to be around 106 million pounds ($118.31 million) for the current fiscal year, up from 56 million pounds reported last year.

Britain has been battling a sharp rise in energy costs, which have pushed the inflation rate to 9.9% in August. To ease the pressure, the government has said it will cap wholesale electricity and gas costs for businesses at less than half the market rate from October until the end of March.

Despite the rising costs and the volatile macro-economic environment, Pennon said its trading has been in line with its guidance.

The company now anticipates a deferred tax credit of around 120 million pounds after the government reversed its plans to increase corporate tax and scrapped the country’s top rate of income tax last week.

Shares of Pennon were down 1.8% in early trade.

($1=0.8960 pounds)

(Reporting by Radhika Anilkumar in Bengaluru; Editing by Sherry Jacob-Phillips and Uttaresh.V)

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