Martin Lewis has today issued a timely warning regarding the impending energy price cap increase, scheduled to hit in four days – highlighting a crucial tip that could help households sidestep the imminent 10% hike. Ofgem’s revised energy price cap for the period from October to December is set to kick in on 1 October.
Ofgem, the industry regulator, has already signalled that average household energy bills will ascend by £149 starting from October. The price cap is slated to escalate by 10%, elevating from the present figure of £1,568 for an average home in England, Scotland, and Wales to £1,717.
Sharing insights on Good Morning Britain today, financial guru Mr Lewis pointed out that despite a general uptrend, wholesale rates are actually reducing, and energy providers are now proposing tariffs lower than ones seen just weeks earlier. He underscored that while the price cap rate is on an upward trajectory, individuals could nearly offset the full 10% increment by switching plans.
He advised host Susanna Reid: “So as we’ve just seen, energy is going up. It’s not coming down. It’s going up on the first of October. It’s likely to come down a tiny bit in January, but it will be a lot more than it is right now.”
“Now these wholesale rates coming down, the price energy firms pay coming down means they’re offering cheaper tariffs now than they were a couple of weeks ago. So bizarrely energy prices are going up if you’re on the price cap. But the cheapest rates available if you’re going to switch, are coming down.”
He advised people to check comparison sites to snag the best energy deals, noting: “Outfox The market is the cheapest fix. Right now it is 9.4% cheaper than the October price cap on average. So on the new price cap and 0.8% cheaper than what you’re paying. So you could drop a tiny bit now, But from next week, you’re going to be paying 9.8 percent less than the new price cap.”
“EDF has a that basically says you can fix now at the current rate. So you just simply don’t get that price, right? That’s it. You just don’t stop the price rise. So you’re asking me, should I fix? I would say for the vast majority of people who are risk averse and don’t want to see prices going up, fixing now is the safe option.”
“This isn’t about just any fix; it’s about securing a cheap fix. If youre going to lock in a price, make sure its the cheapest fix available. So, if I were to spell it out, its clear as day – Outfox The Market and EDF stand out, being much cheaper than the rest, and the Octopus 15 month fix you mentioned is 7% below the October price cap.”
Last month, Labour’s shadow minister for energy consumers Miatta Fahnbulleh engaged in discussions with suppliers such as Octopus Energy, pushing for a marketing push to inform customers about existing support options for their bills.
Sources familiar with the situation have revealed that ministers have also been inquiring firms about long-term market reforms for energy bills, including a social tariff, a proposal that campaign groups have been advocating for several years.
This measure would likely manifest as a targeted discount energy deal for less affluent customers, potentially even lower than the price of the cheapest available standard energy tariff.