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Daily Mirror
Daily Mirror
Business
Levi Winchester

Why your energy bills could shoot up BEFORE huge October price cap rise

Households have been warned that energy bills could rise before the expected October price cap rise.

Ofgem and Energy UK said it was "possible" direct debits could go up - and argued the reason for this would be to balance out higher usage this winter.

Customers normally build up "credit" in the warmer summer months to compensate for higher usage during the colder months.

"It's therefore possible for direct debits to increase ahead of a price cap rise or even when a customer's use has remained constant," an Ofgem spokesperson told the BBC.

Energy UK, the trade body for the energy industry, said direct debits are "reviewed periodically" but said any increases must take into account several factors.

Are you worried about affording your energy bills this winter? Let us know: mirror.money.saving@mirror.co.uk

This includes your estimated usage, current tariffs, debit and credit balances and recent meter readings.

Energy companies must also clearly communicate any changes to direct debits to customers, said Energy UK.

It comes after MoneySavingExpert founder Martin Lewis yesterday warned energy bills will rise “pretty much immediately on the 26 August” when Ofgem reveals its new price cap level for October.

"As soon as the announcement is made from Ofgem on the 26 August, that crystallizes the direct debits going up," he said.

If you have excess credit in your energy account, you are allowed to ask your energy provider to refund it to you at any point.

Before claiming back any money, remember to take into account the expected rises and whether you’d still be able to afford to pay your bills without the credit in your account.

Energy experts this morning warned that gas and electricity bills could top £5,000 next year.

Consultancy Auxilione said Ofgem could set its price cap at £5,038 per year in April - in yet another blow for worried Brits.

Its experts warned the price cap could hit £4,467 in January 2023 - meaning the average household would be forking out £571 for energy.

The predictions from Auxilione put the price cap £2,496 higher than its current level set in April of £1,971.

It is also higher than the figure published earlier this week by Cornwall Insight.

Cornwall Insight expects the price cap to rise to £3,582 in October before another climb to £4,266 in January 2023.

The price cap sets a limit on the rates a supplier can charge for each unit price of electricity and gas you use.

It also sets a maximum for the daily standing charge, which is what you pay to have your home connected to the grid.

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