Martin Lewis issues urgent plea as British Gas profits skyrocket and Brits face £4k bills
28 July 2022, 10:11 | Updated: 28 July 2022, 10:37
Martin Lewis has urged Boris Johnson and Tory leadership candidates Rishi Sunak and Liz Truss to intervene amid concerns energy bills will soar again putting enormous pressure on already squeezed households.
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The average household's energy bill might hit around £500 in January alone, experts have warned as another gloomy forecast for consumers across the country was released.
BFY Group, a utilities consultancy, said it expects the cap on bills to hit £3,850 between January and April next year - hundreds of pounds more than prior predictions.
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It would be a near-doubling of today's record price cap which at £1,971 is already hundreds of pounds more than the previous high.
The Money Saving Expert founder tweeted today: "Calling for Sunak, Truss & Johnson to urgently meet (they are part of same party after all) to come up with an action plan to urgently intervene in the disastrous predicted 77% energy price cap due Oct.
"This isn't the time for a flaccid govt."
The worrying forecast comes amid reports British Gas owner Centrica posted operating profits of £1.34 billion in first half of this year, five times more than in the same period in 2021 when the figure was £262m.
OFGEM chief on how to reduce energy bills
The Kremlin further strangled the flow of gas to Europe this week.
And while the UK gets very little of its gas directly from Russia, the price paid here is determined by what happens across the continent.
"Following further rises in wholesale prices as flows of gas from Russia to Europe via the Nord Stream 1 pipeline drop to 20% of capacity, we now forecast the Ofgem price cap to rise to £3,420 in the fourth quarter of 2022 and £3,850 in the first quarter of 2023," Dr Gemma Berwick, a senior consultant at BFY Group said.
"This will make the average household bill over £500 for January alone."
Cornwall Insight, another consultancy, had predicted a £3,364 January price cap just three weeks ago but circumstances have now changed significantly.
Martin lewis explains how Brits' bills will go up as price cap rises
BFY now believes Ofgem will have to set the earlier October price cap change at £3,420, with another increase expected when the cap is reviewed in January.
The cap used to be updated twice a year, but recent changes mean that there will be a new price cap every three months going forward. It is based on the average cost of energy in the previous months.
Although it is still early days for the January prediction, analysts already have most of the data they need to accurately forecast October's rise.
The Government was previously forced to act in May by announcing a major package of support for households.
But at that point the prediction for October's price cap was just £2,800 - more than £600 lower than the latest forecast.
