MARTIN Lewis has warned that energy bills could rise by another £1,000 a year this winter.
More than 2Omillion households are on default tariffs which are set to go up in October.
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The energy price cap is set by Ofgem twice a year and reflects the wholesale costs of gas and electric.
The cap limits the per unit price of energy suppliers can charge, and means the typical dual fuel bill is £1,971 – though you can pay more or less depending on usage.
Now experts believe that the price cap will rise this winter pushing up bills to just shy of £3,000 a year.
Martin said that experts at Cornwall Insights, a firm which tracks wholesale energy prices, now calculates bills could rise by around £1,000 during the coldest months.
The money saving expert said on Twitter: “Just got latest @CornwallInsight price cap predictions. Wholesale prices spiked heavily last week, so they’re up a lot.
“Today’s price cap: At typical use = £1,971/yr Prediction Oct – Dec: UP 51% (£2,980/yr typical use) Prediction Jan – Mar: UP 1% (£3,000/yr typical use)
The latest estimates are higher than previously forecast. Last month Ofgem said it expected the next price cap review to push energy bills up to £2,800 a year.
Cornwall Insight now predicts bills of around £2,980.63 from October to December.
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It then says there could be another small rise in the price cap to £3,003 in January 2023 before dropping down to £2,758 in April and £2,686 in July.
The exact change to the price cap is yet to be decided by the regulator and could still change.
Ofgem has proposed reviewing the price cap more often than twice a year to smooth out increases over a longer period.
After October it could see the next increase in January 2023 instead of April.
The estimates are based on the wholesale cost of energy which has shot up in recent months due to global supply issues and the war in Ukraine.
An increase in April of 54% has already pushed bills up by hundreds of pounds for millions of households piling pressure on people’s finances.
The further increase expected in October has prompted the government to act, announcing several one-off cost of living payments this year worth up to £1,500 for the hardest hit.
That includes £400 to help with energy bills this winter – and the cash won’t have to be repaid.
Martin said that he will be using the latest price predictions to update his guide on whether it’s time to fix your tariff.
Last week he urged billpayers to check if their supplier was offering a fixed deal that is no more than 35% or 40% more than the current price cap.
But that figure is likely to change on the back of the new price predictions.
Fixed deals are now pricier than the default price-capped tariffs but could save you some cash in the long term with future rises.
There are no fixed deals openly available that are worthwhile according to MSE, but suppliers are offering some customers a decent fix directly.
Meanwhile billpayers could get extra help for bills to help them through the cost of living crunch – here’s what you could get id you’re struggling.
Energy bill help
There are schemes offered by suppliers, local councils, charities and the government that could help.
If you’re struggling with energy costs or other bills there are plenty of organisations where you can seek advice for free, including:
You should speak to your energy supplier in the first instance as they have schemes in place to help with bills and arrears, including hardship funds and grants.
For example, British Gas and Octopus have set up funds worth up to £750 to help customers who are struggling with their bills.
Your local council may also be able to help with cash and grants if you are struggling with bills through the Household Support Scheme.
You should also check that you’re getting all the benefits you’re entitled to.
Use an online benefits calculator to make sure you’re not missing out on any extra cash.
Similarly, you can search for charity grants that help you pay for gas and electricity bills.
There’s more help from the government on the way too, later in the year in the form of one-off cost of living payments worth as much as £1,500 depending on your circumstances.
Every household will get £400 off their energy bill this winter.
Those on Universal Credit and certain benefits will get a £650 one-off payment – with the first half hitting bank accounts within WEEKS.
Meanwhile a payment of £300 will go to pensioners and £150 extra is heading to those with certain disabilities too.
The £300 is on top of the annual winter fuel payment where those getting the state pension can get between £100 and £300 to offset the cost of keeping their homes warm over the colder months.
Low income households can get a one-off £150 payment under the existing warm home discount scheme – applications open in the autumn.
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