Pople across the UK can expect a huge increase in energy bills in coming months as the energy price cap rises to £3,549 per year in October. The new price cap, announced on Friday morning, is a rise of more than 80% on April's figure of £1,971 and will come into effect for around 24 million households from October 1.
Government regulator Ofgem's chief executive Jonathan Brearley warned of the hardship energy prices will cause this winter and urged the incoming Prime Minister and new Cabinet "to provide an additional and urgent response to continued surging energy prices".
Research is already forecasting that more than 40 million people in the UK could face fuel poverty as a result of soaring energy costs, with further increases to the price cap on the cards next year. You can read all our latest update's on today's announcement here.
Read more: Martin Lewis gives raw and emotional interview as he issues price cap warning to everyone in UK
Wales' First Minister Mark Drakeford has called for an emergency budget and said: "We're doing all we can to support people in Wales, but UK Government's failure to address this crisis will result in further hardship for many families."
And with the cap not predicted to drop until the third quarter of 2023, people will be feeling the pinch for quite some time.Even if that does happen, it is only expected to drop to £5,897.12, still 66% higher than the new price cap announced today. A further fall to £5,887.31 is currently forecast for the final quarter of next year.
The UK government has wagered heavy criticism for not taking action to reduce the cap, both from the public and ministers of devolved governments. Welsh Social Justice minister Jane Hutt has hit out by saying, "The continued inaction by Westminster carries the real risk of consigning the people of the UK to a decade of poverty. This cannot be allowed to happen."
Chancellor of the Exchequer for the UK government, Nadhim Zahawi said: “I know the energy price cap announcement this morning will cause stress and anxiety for many people, but help is coming with £400 off energy bills for all, the second instalment of a £650 payment for vulnerable households, and £300 for all pensioners."
Speaking in Cardiff city centre on the day the new energy cap was announced, shoppers have been reacting to the news and sharing how they intend t cope with the rising prices. Unsurprisingly, most believe the UK government are not doing enough to reduce the pressure on household bills.
One person, Barry Payne said: "I think is absolutely disgusting be honest and the government has had enough time to sort all this out now. We don't know now what the cap is going to be but we know now it's going up again in January." He went on to criticise the profits wagered by energy company bosses despite rising costs.
He said: "These executives are on about £500,000 a year without bonuses and they're making a billion pounds a second and yet can't cut back on bills when people are struggling. Coming up to the winter now and you've got pensioners too scared to put one bar on, I think it's disgusting."
Earlier this month, BP reported underlying replacement cost profits - its preferred measure - jumping to 8.5 billion US dollars (£6.9 billion) for the three months to June 30, up from 2.8 billion US dollars (£2.3 billion) a year ago. Around the same time, it was announced that Shell employees would be getting an 8% pay rise.
And these profits have not gone unnoticed. John Pugh said he feels he is being 'ripped off' by the giants. He said, "I feel the energy companies are ripping us all off. They've just posted huge profit forecasts, billions of pounds. They tell us they can't afford to keep the prices the same, you just don't believe them. It's the way the world has gone, it's a very greedy world."
Another shopper, Kyra Kramer, has lived in the UK for six years and questioned why the UK Government was not imposing a cap such as other countries have. She also said that companies are using the invasion of Ukraine as a scapegoat for rising costs. She said: "I think the price cap should be lower. I think the Russian invasion of Ukraine is an excuse by gas and oil companies to raise prices when they don't need to be raised.
"The French capped everything at 4% and I fail to see why all the other governments cannot cap that for their citizens because more than 3000 is too much for a lot of families who are working in Wales."
Like many people, she questioned where it is possible to save on gas and electricity in a world which relies so heavily on both. She explained, "there's only so much you can do. You can't take away two children's computers, they need those for a lot of things. And what are you going to do? Stop doing dishes? Stop doing laundry. I mean, you just you need electricity nowadays."
But despite the increased pressure that will soon be placed on households, some people believe it should be taken in their stride. Tony Davies said: "It's one of those things we can do very little about. It is what it is and we have to make the best of it. I think like a lot of people I'm using a lot less energy than I used to. I'm more efficient with the energy I use, which I don't think is a bad thing."
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