MARTIN Lewis has revealed how energy bills will likely increase by as much as 40% early next year.
Despite being explicitly warned, he is still stuck by his advice that households should “do nothing”.
That’s the advice he’s been adopting since the chaos that followed in early October, especially as the appalling decline of the upside means Suppliers started going bankrupt.
The currency mogul was the first to urge households to switch to cheaper deals and shop around for better prices.
Now that the entire market has been affected, there is little or no competition to choose from anyway.
But speaking on the TV channel last Thursday, Martin analyzed exactly what is going on with the energy markets at the moment, and how sitting tight is your best bet on the energy market. avoid extra cost.
Brits are going through a cost of living crisisand the destroyed energy market doesn’t help, so many people turn to savings experts for advice on what to do as costs rise.
On the Martin Lewis Money Show, he explained to viewers how wholesale gas is currently at 4 times the regular price, which is something that has never been seen before.
In “normal times” cheap fixed deals aren’t usually the cheapest overall, he said, but that’s been completely dismissed by new price we are seeing in the current energy crisis.
“Last November the cheapest contract was around £830 a year for a typical user, the typical fix you can get today is £1,730,” he said.
“So that’s more than double what you would have paid a year ago, a huge and phenomenal increase.”
However, the reason it has the potential to rise to 40% or even beyond next year is based on the pattern we’ve seen so far of cap rise.
It is designed to prevent providers from overcharging customers for their energy bills because it sets a maximum that you can be charged.
That’s also a 12% increase, Martin explains, but it’s based on how prices have been over the past six months and their averages.
Now that wholesale prices have skyrocketed, the same math of averaging over the same time period means prices are likely to increase by 40%, Martin revealed, while pointing to an image showing prices will how formed.
Therefore, he urges viewers to do nothing, given how expensive the cheapest fixed price is currently.
If they stick with what they have now it’s likely they’ll have the same price after April as it’s fixed and can’t change no matter how much the price goes up with the next price cap update .
Martin said: “A year ago I yelled at you, what price are you at because it’s more expensive than the cheapest deals, get yourself the cheapest deals.
“But for now, because the price cap only changes every six months and it’s set based on a timeline, the price cap is currently the cheapest meaningful tariff you can get.
“There’s no savings you can get by moving.”
The advice is also true of other warnings that have come late, other experts have warned that price limit can increase more often to keep up with the soaring races.
So sticking to a flat tax rate could mean you’ll casually forgo price increases if you’d still signed up for a cheaper, guaranteed deal a few months in advance.
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https://www.thesun.co.uk/money/16945569/martin-lewis-energy-bills-hiked-do-nothing/ Martin Lewis warns households will pay 40% more on energy bills next year but you should still ‘do nothing’