MILLIONS of Brits could be saved from a £500 bill hike as Jeremy Hunt is poised to extend the Energy Price Guarantee.
The Chancellor is looking to stop gas and electricity bills rising from £2,500 to a whopping £3,000 in April.
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However, no final decisions have been made.
Confirmation will come on March 10, when Mr Hunt reveals his highly-anticipated Spring Budget.
The Sun understands officials are trying hard to save consumers from next month’s crippling hike.
They want prices to be capped at £2,500 until July this year.
But a Treasury source said energy suppliers have been asked to prepare for both scenarios.
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Behind the scenes, Energy Secretary Grant Shapps has been lobbying for a halt.
A Whitehall source told The Sun: “There is a very keen desire within the Energy Department to see energy bill support continue at the current rate.
“We need to keep working with Treasury to see what might be possible.”
The source added that Treasury officials are receptive to the idea.
Meanwhile, Money Saving Expert Martin Lewis told the BBC this morning he thinks there’s a “better than 50% chance” of bills not rising.
“I wouldn’t say it’s a done deal,” he said.
“I was saying in the office I think it’s a better than 50% chance.”
An energy sector source told The Sun: “This would be a very positive step from the Government, which provides much needed certainty for consumers on their energy bills in the months ahead.”
What is happening to energy bills?
At the moment, household bills are protected by the energy price guarantee which is £2,500 a year on average.
In April it is due to rise to £3,000.
Households have also been benefiting from a £400 energy rebate, which has been applied to energy bills in six instalments.
The last payment is being made this month, meaning bills will rise by £67 a month at the same time as the energy price guarantee goes up.
However, wholesale energy costs are falling.
Earlier this week, Ofgem revealed that the energy price cap will fall to £3,280 a year from £4,279 a year in April due to a drop in wholesale costs.
The price cap was introduced in January 2019 to help protect households from bill rises and it currently changes every three months.
However, it was temporarily replaced by the energy price guarantee in October 2022, as the government wanted to protect households from catastrophic rises in bills.
The energy price guarantee will exist as long as it is more than the price cap.
Wholesale costs are still falling and it’s been predicted that the cap will fall to £2,100 in July.
That’s why Mr Lewis and charities have been calling on the government to postpone the EPG rise in April as they argue households can’t afford the rise due to the on-going cost of living crisis.
If the support does continue the government will have to spend more than previously planned to support households.
What help is available now?
Millions are currently receiving a £400 energy rebate in six instalments starting from October last year, but the final payment worth £67 will be made this month.
At the moment all households with a domestic electricity meter or direct relationship with their provider receive the discount.
Martin Lewis’ MoneySavingExpert.com has unveiled a new calculator that can give you an estimation of what your bills might go up to from next month.
There are also loads of schemes your energy supplier could provide, with some granting as much as £1,500.
British Gas, E.ON, Octopus and Ovo all offer grants worth hundreds of pounds.
But don’t worry if you don’t know who your supplier is – you can use Ofgem’s supplier search tool on its website.
Alternatively, just ask your supplier directly what funding is available.
We also did a roundup of energy suppliers offering free credit to hard-up households – read our guide here.
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It’s also worth checking if you are eligible for benefit payment such as the warm home discount or winter fuel payment.
Some households were not eligible for the energy rebate, for example if they were not connected to the main gas grid and use alternative fuels.
They can now apply for a £200 discount, via the government’s online portal.
