Martin Lewis' Money Saving Expert issues energy bills warning over price cap fall
The Ofgem energy price cap is set to fall seven percent within weeks - but Britons have been told to bear two key things in mind.
Martin Lewis has issued an energy bills warning via Money Saving Expert (MSE), which he founded, to Britons ahead of the Ofgem energy price cap dropping.
MSE's weekly newsletter pointed to two key things that customers need to bear in mind despite the good news of an average seven percent drop.
The first is that the plunge in prices, though welcome to energy users, will be "the last predicted fall for now". And the second, of even greater concern, is that the cap is tipped to rise by 12 percent in October.
If the rise does come in as predicted, that means that for every £100 currently spent on energy bills, consumers face paying £104.
That's in stark contrast to the drop people will enjoy in July, when they will spend £93 for the same energy they're currently paying £100 to use.
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Though prices are tipped to stay flat in the price cap announcement scheduled for January 1 2025, MSE advises its readers to fix their tariffs now.
It comes just days after Martin Lewis issued a warning over a 'nasty' charge being added to gas and electricity bills this summer.
Customers at major energy firms like British Gas, EDF and EON have today been told that Ofgem is handing down a new, reduced price cap which takes effect from July 1.
The new cap will save the average household about £122 per year on their bills, but there's a nasty downside despite much campaigning from Martin Lewis.
The money guru took to social media to explain the 'much despised' issue.
He said: "The much despised standing charge is unchanged. So you’ll continue to pay around 90p a day just for the facility of having gas and electricity even if you don’t use it. And that’s particularly nasty in the summer period.
"Because there are many households especially with older people in who only use their gas for central heating, and that’s turned off during the summer but they’re still having to pay 30p a day standing charge just for the facility of having gas.
"Now I’ve long complained and campaigned to bring the standing charge down and bring some of the fixed cost to the unit rate. That has not been done yet.
"I know many people hate the standing charge. It is a moral hazard. It means the people at the lower end don’t get as much reduction when they cut their usage to cut their bills.
"It also means in July that people who get the biggest benefit are the higher users because they get a bigger gain of the unit rate dropping.
"But that’s the way it works, I’ve spoken to Rachel Reeves about it, I’ve spoken to Ofgem many times, and we are due a consultation report on the standing charge this summer. My fingers are crossed they’ll bring it down.
"But there is a problem that it takes government to protect vulnerable high users, and Ofgem may not bring the standing charge down because it doesn’t have the power to protect those vulnerable high users."
