Households’ energy expenses could skyrocket,

Households’ energy expenses could skyrocket to an eye-watering £2,800 per year.

Ofgem CEO Jonathan Brearley told the Business, Energy, and Industrial Strategy Committee that an energy price cap “in the range of £2,800” is expected in October.

Previous forecasts indicated that the price cap would rise to £2,750.

On April 1, the price cap increased from £1,277 to £1,971, adding £700 to bills for 22 million people.

However, the Ofgem CEO told the Committee today, “I am afraid to declare that conditions in the global gas market have deteriorated since Russia’s invasion of Ukraine.” Gas prices have risen and are highly variable. They have now reached more than ten times their original size at times.

“As a result, later today I will write to the Chancellor to provide him with our most recent projections of the price ceiling increase.” This is uncertain because we are just halfway through the price limit window, but we anticipate a price cap in the area of £2,800 in October.”

It implies that when the new price cap goes into effect in a few months, homeowners’ expenses might rise by £830.

The energy price ceiling is in place to limit how much suppliers can charge for default rates, protecting customers from exorbitant bills.

However, it is mostly determined by wholesale energy prices and supplier expenses.

These have risen in recent months, resulting in massive gas and electricity bills for households.