Martin Lewis has issued a message to anybody who gets their energy from British Gas or E.on. He's offered out advice that could save millions of people money if they take it on board.
Earlier this week it was announced that Ofgem would be increasing the energy price cap for all households in the UK yet again in October. This will take the price cap up by a whopping £830 to £2,800.
Understandably, people are worried. They have been looking to the Money Saving Expert for advice.
READ MORE: Woman instantly gets £125 added to her bank account using 5-minute Martin Lewis tip
The MSE founder explained that there are currently no open-market rates that are cheaper than the current price cap - but you may be offered a cheap rate from your existing provider. The margin Martin gave for considering locking in now was 30 per cent above the current price cap - or 35pc if you’re after price assurance.
He said: “[The price cap] is going to go up 42pc, we’re predicting in October - and then even though the new price cap only lasts three months, the latest estimates I’ve had from analysts is the January price cap for the next three months is going to be the same.
“So we’re expecting it to be around £2,800 until next April - it’s horrible isn’t it - then it is going to drop a little bit. When you plug all that in to where we are now - four months on this price cap, then six months on the next price cap - effectively, if you can find a fix below around 30pc of the current price cap, then it’s probably worth doing. You can add 5pc on top of that because you get price assurity of knowing what your prices are.”
The two energy firms Martin highlighted as ones that are reportedly offering existing customers fixed rates below 30pc of the current price cap are British Gas and E.On. As these rates are not advertised online, you have to be a customer with these firms already to be offered them, says the Mirror.
“We’re seeing existing customer fixes where an existing company is offering you a cheap fix,” explained Martin. They don’t have to publish those rates, unlike those open market ones, so I don’t have them. I ask people to feed them in and we estimate them.
“I believe there is an E.On two-year fix that people are being offered and British Gas one-year fix that people are being offered that are within less than 30pc [of the price cap]. If you’re being offered those, you may want to look into it.”
The price cap for those on default tariffs paying by direct debit increased by £693 from £1,277 to £1,971 last month. This marked an eye-watering rise of around 54pc as the UK continues to struggle against a cost of living crisis.
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