The energy price cap could skyrocket to £2,800 in October, the Ofgem chief warned MPs this afternoon.
Jonathan Brearley told the Commons Business Committee the price cap would rise by almost £1,000 because of the volatile gas market.
The news comes as Chancellor Rishi Sunak considers a windfall tax on electricity generators and oil and gas giants in a bid to help struggling households.
Boris Johnson said last week he cannot “magic away” all the soaring food and energy expenses, as he came under increasing pressure to alleviate the cost-of-living crisis.
Mr Brearley told MPs "we need the government to step in... broadly this is only something government can address".
He added: "I know this is a very distressing time for customers but I do need to be clear with this committee, with customers and with the government about the likely price implications for October.
“Therefore later today I will be writing to the Chancellor to give him our latest estimates of the price cap uplift.
“This is uncertain, we are only part way through the price cap window, but we are expecting a price cap in October in the region of £2,800.”
The current cap which stands at £1,971 applies until September 31. It was a £693 increase from the previous cap six months earlier.
Thousands more Brits are set to fall into debt with at least four in 10 people braced for fuel poverty in October.
The Prime Minister's former aide Samuel Kasumu told the Mirror ethnic minority Brits will suffer the most as only 30% have just a month's savings to help them through this crisis.
Last month, Simone Rossi, chief executive of EDF energy warned households “haven’t seen the worst yet” even after people were slapped with “unprecedented” rises in energy bills on April 1.
Scottish Power chief executive Keith Anderson urged the Government to take £1,000 off the bills of the poorest people in the country in October.
“I’m hugely concerned for people”, Mr Anderson told MPs on the Business, Energy and Industrial Strategy Committee in April.
“So many people are going to struggle with this issue. We’re seeing there were 8,000 calls last week from customers concerned with their ability to pay, and that’s just the first few weeks after this price increase.”
According to the FT, Mr Sunak has instructed Treasury officials to work on plans for a potential tax on more than £10bn of excess profits made by electricity generators, including windfarm operators.
Energy giants have been netting record profits amid rocketing prices Russia ’s war in Ukraine pushes up global wholesale prices.
But Treasury sources have insisted no decision has yet been made on any windfall tax plan.
Asked about possible measures on Monday, Chief Secretary to the Treasury Simon Clarke poured cold water on the idea, saying ministers were “not going to rush into action”.
