Energy bills set to rise even higher in worrying new prediction

Energy bills are set to rise even higher than previously predicted, according to worrying new figures released today.

Energy consultancy firm Cornwall Insight has forecasted that the average household will be paying £3,582 a year, £200 higher from the £3,359 originally predicted earlier this month.

And from January, the amount is expected to rise even higher to £4,266 before continuing to rise in April to £4,427.

The previous forecast for April was £3,729 – that’s a rise of £650.

Cornwall insight said it had increased its forecast due to the continuing rise in wholesale prices and an expected change in methodology for how the energy price cap is calculated.

Dr. Craig Lowrey, principal consultant at Cornwall Insight, described the predicted increase in January as a ‘fresh shock’.

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He said: “The cost of living crisis was already top of the news agenda as more and more people face fuel poverty, this will only compound the concerns.”

However, Dr. Lowrey explained that without the more frequent changes to the price cap, more energy suppliers might be in danger of collapse.

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He said the change in how the price cap is calculated was necessary to prevent suppliers going bust, but added: “Rather than critiquing the methodology of the cap, it may be time to consider the cap’s place altogether.

“After all, if it is not controlling consumer prices, and is damaging suppliers’ business models, we must wonder if it is fit for purpose – especially in these times of unprecedented energy market conditions.

“It is essential that the government use our predictions to spur on a review of the support package being offered to consumers.

“If the £400 was not enough to make a dent in the impact of our previous forecast, it most certainly is not enough now.”