MARTIN Lewis was close to tears warning households of “catastrophic” energy bill rises after the new price cap was confirmed.
The price cap – which limits how much suppliers can charge customers for energy – will increase by £1,578 from October 1, Ofgem said this morning.
1
Those who pay for energy bills by direct debit will see their bills increase by an eye-watering 80% from £1,971 to £3,549 on average a year.
This is even higher for prepayment meter customers, who have been stung with a £1,591 bill increase after the price cap moved from £2,017 to £3,608 a year.
Experts have warned the crisis will only get worse. Consultancy Auxilione estimating households will be paying more than £6,500 a year for bills from April.
Commenting on October’s new price cap revealed this morning, consumer champion Martin Lewis said it marked an “unaffordable, terrible rise in energy bills”.
He said on BBC Radio 4’s Today programme: “If we do not get further government intervention, on top of what was already announced in May, lives will be lost this winter.”
He reminded listeners that because the cap does not protect customers from rising wholesale prices, it is not a cap on how much you can be charged for the energy that you use.
It means that you could be paying more than the price cap if you use more energy than the typical household, you could be paying more for your bills.
He said: “There is nothing stopping someone from paying £10,000 a year, which I suspect is what some homes with people with children or with disabilities who need special electronic equipment will be using.”
It comes as regulator Ofgem said the price cap will be reviewed twice as often per year.
Most read in Money
The price cap will be reviewed four times a year, instead of two, which will be a bitter blow to households.
It means that should energy prices keep rocketing like experts predict, these increases will be passed on more quickly to customers.
Millions of households will be worried about whether they will have enough money to pay for the spiralling costs – even with the government support already announced.
On the same day that the new price cap comes into force, households across the country will start to receive a £400 energy bill discount from their suppliers.
It means that bills will be reduced by £66 each month, for six months.
But experts have warned that this won’t even scrape the sides of mounting costs, with Which? calling on the government to boost this discount to £1,000.
Eight million households on Universal Credit and other means-tested benefits will get a £650 cost of living payment.
While in November, a £300 one-off “Pensioner Cost of Living Payment” will be paid out to eight million households.
How to get help with your energy bills
Unfortunately, there isn’t an awful lot you can do to escape rising energy prices.
However, there are always schemes and funds available to hold your hand throughout the price hikes.
For example, there are plenty of energy grants and schemes open to help you out if you’re struggling, like the British Gas hardship fund which can lend you up to £1,500 free cash towards bills.
There’s also a one-off fuel voucher from your energy supplier if you’re on a prepayment meter.
In terms of council funds, the Household Support Fund helps families with the rising cost of living, has been extended.
This help could include cash grants to pay bills or cover food costs – the help will depend on where you live.
For example, residents in Blackpool can get as much as £300, depending on their circumstances.
To find out what support is available in your area, contact your local council.
Make sure to check your bills if your energy supplier went bust and you’ve been switched over to a new one.
The Sun has previously reported customers have seen payments taken from both their old and new suppliers.
An energy bill expert has outlined six checks you need to do NOW ahead of bills rising.
We outline the full list of energy discounts you can apply for – you could save HUNDREDS.
