Energy price cap set to rise, warns Martin Lewis amid rising costs

In the United Kingdom, energy prices are becoming increasingly burdensome for households. Martin Lewis, a well-known money-saving expert, has recently provided guidance regarding the rising energy bills. He has noted that, according to predictions from major energy suppliers including British Gas, E.On, and EDF, the energy price cap—set by Ofgem—could increase by 5 to 7 percent during the upcoming adjustment period in April 2025, which significantly affects household costs across the nation. The price cap currently stands at £1,738 for the average household, reflecting a slight increase from £1,717 in January. This trend follows a 10 percent rise that occurred in October 2024, highlighting an unsettling trajectory for energy prices in the UK. With key analysts predicting the price cap will rise again, Lewis emphasizes that 80 percent of UK households are currently overpaying for their energy. He suggests that these households, especially those with suppliers like British Gas, E.On, and EDF, should evaluate their options and consider switching to fixed tariff energy deals. These alternatives could save consumers anywhere from 4.6 to 6.8 percent compared to the current price cap. He noted that Ecotricity and Outfox the Market are some of the few providers still offering such savings of 5 percent or more. However, entering into these fixed deals, which typically last between 12 to 24 months, does carry the risk of exit fees should customers want to leave before the contract ends. Therefore, he urges households to act swiftly to avoid forthcoming cost hikes. The ongoing fluctuations of energy bills in the UK are largely attributed to the volatile wholesale energy market, which impacts the price that energy companies charge consumers. The energy price cap is reviewed every three months, and these adjustments reflect the average energy costs that suppliers incur. Without decisive intervention from the government or regulatory bodies, consumers may face continued price increases, further burdening their financial viability during a time when many are still recovering from the economic repercussions of prior crises. The key takeaway from Lewis's guidance is the importance of being proactive in choosing energy deals, especially as potential increases loom. Taking time to explore and switch to a more affordable plan could potentially result in substantial savings over the year, helping mitigate the financial strain caused by rising energy costs in the UK.