Energy price cap to hit £4,200 a year after Christmas and New Year

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Ofgem energy price cap to hit £4,200 a year after Christmas and New Year

The UK's energy market regulator Ofgem has been partly blamed for the huge hike in energy bills as it forecasts the price cap will now hit more than £4,200 in January. In a new truly awful outlook for households across the United Kingdom, the Cornwall Insight said that bills are set to soar to around £3,582 in October, from £1,971 today , before rising even further in the New Year.

It comes as Ofgem last week announced changes to how it will calculate the price cap on energy bills going forward.“While our price cap forecasts have been steadily rising since the summer 2022 cap was set in April, an increase of over £650 in the January predictions comes as a fresh shock,” said Craig Lowrey, principal consultant at Cornwall Insight.

However, he also defended Ofgem’s decision, which will hopefully lead to lower bills in the second half of next year. This will happen because Ofgem is making it easier for energy suppliers to recover their costs. By doing this, fewer suppliers will fail – and the cost of those failures will not need to be passed on to customers.

Dr Lowrey said that the Government must take action to step in and protect households from the runaway costs. The Government has already promised £400 to every household, and extra help for the more vulnerable.

 

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