Energy bills could rocket to £3,616 this winter, experts warn
HOUSEHOLDS have been warned they could face an annual energy bill of thousands of pounds this winter.
Gas and electricity bills could reach £3,616 in the new year, according to experts - hundreds of pounds more than previous predictions.
In May, the Government announced an energy costs support package – worth £400 per household – in response to predictions that bills would rise to £2,800 for the average household in October.
But experts at Cornwall Insight have said that bills are now likely to rise to £3,358 from October and £3,616 from January.
Families are set to find out how much prices will go up by on August 26 when Ofgem announces the new energy price cap.
The change will come into force from October 1.
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The exact change to the price cap is yet to be decided by the regulator.
The cap limits the per unit price of energy suppliers can charge, and means the typical dual fuel bill is currently £1,971 - though you can pay more or less depending on usage.
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.
Cornwall Insight’s principal consultant, Craig Lowrey, said surging gas prices and concerns about Russian supply have caused the increase.
He added: "While the rise in forecasts for October and January is a pressing concern, it is not only the level – but the duration – of the rises that makes these new forecasts so devastating.
“Given the current level of the wholesale price, this level of household energy bills currently shows little sign of abating into 2024."
Millions of households across the country will receive a £400 discounts off their energy bills from October.
It's up to energy firms to administer and distribute the discount directly to their customers.
On Friday, Richard Neudegg, director of regulation at Uswitch, called for the £400 to be increased to at least £600, and for payments to vulnerable households to rise from £650 to £950.
“The Government did the right thing by stepping in with wide-reaching support to try to help ease the blow.
"However, this support now looks like a severe under-estimation of what consumers need,” he said.
“Households need clarity to help them plan for the most expensive winter in living memory.”
Charity National Energy Action last month predicted that, should the average bill reach £3,250 per year, 8.2 million UK households will be in fuel poverty, or one in three.
What can you do to avoid price hikes?
Unfortunately, there isn't an awful lot you can do to escape rising energy prices.
With the cost of living sky-rocketing and inflation expected to hit 15% by the end of the year, we've all had our purse strings pulled tight, and everyone will be affected.
However, there are always schemes and funds available to hold your hand throughout the price hikes.
For example, there are plenty of energy grants and schemes open to help you out if you're struggling, like the British Gas hardship fund which can lend you up to £1,500 free cash towards bills.
There's also a one-off fuel voucher from your energy supplier if you're on a prepayment metre.
Contact your supplier directly to see what they offer, what the eligibility requirements are, and how much you can get.
If you don't know who your supplier is, you can find out .
In terms of council funds, the Household Support Fund helps families with the rising cost of living, has been extended.
This help could include cash grants to pay bills or cover food costs - the help will depend on where you live.
For example, residents in Blackpool can get as much as £300, depending on their circumstances.
To find out what support is available in your area, contact your
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If you're a pensioner, there are also extra grants available if you're worried - those on Pension Credit should be eligible for the £650 cost of living payment.
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All pensioners should also get an extra £300 payment in November or December to help pay for bills and essentials.
Cost of living payments: what you need to know
- All the key dates for cost of living payments revealed
- Every household will get a £400 cost of living payment to help with energy bills
- See the full list of benefits eligible for £650 cost of living cash
- Here's free cash you can get if you DON’T qualify for the £650 cost of living payment
- Millions of pensioners will get a £300 cost of living payment this winter
- Disabled Brits will get £150 this September
- Parents can get up to £200 towards school uniform costs