Currently, the government Energy Price Guarantee has capped bills at £2,500, but this is due to rise to £3,000 in April despite Ofgem lowering the energy price cap. Due to the fall in the price of energy, Martin Lewis is now predicting Prime Minister Rishi Sunak will backtrack on the 20% increase.
There has been widespread calls for the planned increase to be scrapped and Martin Lewis believes the PM will give into the pressure. Speaking on LBC radio, he said: “Reading the runes, and I’m careful of my phrasing, I think we may well get a win here. I think there is better than a 50/50 chance of it not going up.
“Politically, it’s not a very clever move either. It’s the government that sets prices, not the regulator, not firms. And it’s the government that will be putting them up 20% in April if it happens."
On Monday, energy regulator Ofgem announced that from April its energy price cap - the amount suppliers are able to charge – would be lowered from £4,279 per year to £3,280 for the average household. The regulator said the reduction reflects recent falls in wholesale energy prices.
However, due to the current EPG increase, customers will pay approximately an extra £500 for their energy bills. When factoring in the energy of the £400 energy rebate scheme, the potential cost would increase even more.