The latest Ofgem energy price cap has risen to a bone-chilling £3,549 for customers on a direct debt, representing a 178% spike since October 2021’s limit of £1,277.
“After all the estimations, predictions and finger-in-the-air sums we finally know the extent of the energy price hike everyone is going to endure in October,” said AJ Bell head of personal finance Laura Suter.
“The price cap has risen to £3,549 for everyone paying by direct debit, a whopping 178% increase on last October’s average annual bill of £1,277.”
“Last October we saw an increase of £139 in the average annual bill as a result of the price cap, but this year’s jump is more than 11 times higher at £1,578.”
The shocking figure comes on the tail end of the Covid pandemic, and with many households still struggling to shake off the impact of two years of lockdowns, the latest price cap news is set to make this Christmas a true winter of discontent.
The war in Ukraine has put a chokehold on energy supplies from Russia, with the rest of Europe bracing for three days of gas shortages via the Nord Stream 1 pipeline as Russia shuts down supplies for unscheduled maintenance.
“There’s no doubt that for many households a bleak winter is ahead – particularly with another price hike on the horizon in January after the regulator pushed ahead with its controversial reformed price cap. Many households can’t afford energy bills at their current level, let alone bills that are thousands of pounds a year more,” said Suter.
“With average annual energy bills at £3,549 that means energy costs are well over a third of the annual state pension of £9,628. Even pensioners getting the full government support available to them of £1,500, are still facing paying more than £2,000 for their energy bills, which many simply won’t be able to afford.”
Households across the UK are facing surging prices they will not be able to afford, with typical advice to switch off electronics at the base or reduce energy use as much as possible bearing meagre fruit for struggling consumers in the face of eye-watering bill increases.
“Frustratingly for those struggling with energy costs there are no easy hacks or tricks to significantly cut their bills – advice to turn off chargers, or devices not in use, will save pennies and is insulting to families facing such staggering price increases,” said Suter.
“What’s more, with standing charges having risen slightly, it now costs £5.18 per week before you’ve even used a unit of energy.”
“The only option is to cut energy usage as much as possible and hope for further Government support for those struggling the most.”
