The energy price cap could jump by another £600 later this year, according to early predictions from industry experts. There are indications that the energy price cap, which already saw a 54% increase in 2022, could go up even further in October as millions of people struggle to cope with rising costs of living in the UK.
The energy regulator Ofgem has already said people in the UK should expect another increase to the cap as the cost-of-living crisis in the UK deepens and the region feels the financial impact of the Ukraine war. Last week its chief Jonathan Brearley said: "Gas markets remain in a febrile state since the Russian invasion. Prices fluctuated from nearly 16 times the average price last winter at its highest to around four times what we'd usually see. The market remains highly volatile and as a result we do expect further price increases later this year."
Read more: What to do if you're worried about gas and electricity bills and how Ofgem changes could affect you
And the energy price cap could be set to rise by around £600, to £2,600 per year, in October according to market research group Cornwall Insight. Money Saving Expert and financial journalist Martin Lewis shared the group's latest forecast on his social media on Tuesday, saying:
"First Cornwall Insight predictions in for the new three-monthly price cap. It's likely to rise 32% in October, then stay flat for January. So for someone with typical direct debit dual fuel use:
Was (pre-April): £1,277/year
Now (April-October): £1,971/year
October-December: £2,600/year
January-March: £2,600/year
"As my fellow money journalist (but no relation) Paul Lewis pointed out on Twitter yesterday, £2,600 is 'about one third of the state pension (average payment is £8,530) and two thirds of a single person's universal credit of £4,018 (88% if less than 25).'"
Ofgem revealed this week that the price cap on household energy bills could be reviewed every three months. The energy regulator said that it might insert two new reviews a year, one in January and another in July. It said this would help pass on savings from a potential fall in gas prices to customers more rapidly and also protect under-pressure energy suppliers from being damaged by the cap.
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