Financial journalist Martin Lewis has issued a warning to everyone who is planning on cancelling their direct debits for their energy bills.
April 1 marks the dawn of the new energy price cap which will see bills rise by 54 per cent.
That means that those on direct debits will have an extra £693 added to the average household bill while those on prepayment meters will have an extra £708.
READ MORE- British Gas, SSE, EDF Octopus Energy and more confirm prepayment tariffs ahead of price cap
Mr Lewis has warned that we are entering a cost of living crisis as bills will soar to record highs and is urging the UK Government to intervene.
Already the Government have announced that they are implementing a £200 energy rebate to all electric bills in October, but experts warn that this will not be enough.
On top of the increase in April, it is likely that the price cap will rise again in October and come April 2023, households will be paying back the £200 rebate in instalments of £40 each year.
In a bid to control their spending, the financial guru has picked up on that many are considering cancelling their direct debits and move to a pay as you go system.
But he has issued a stark warning against that.
Taking to Twitter, Mr Lewis said: "WARNING! Many talking about cancelling energy Direct Debits to 'keep in control' and just pay when billed. Yet be aware that's usually charged at a HIGHER RATE."
He broke down the costs and explained that people on a monthly direct debit with typical use will be have a price cap £1,971.
Those on prepay meter (pay as you go) will have a cap of £2,017 and those on quarterly bills will be issued with a price cap of £2,100".
However, it should be noted that the price cap does not limit how much your bill can be. The price cap limits the cost of each unit but if you use more energy, then your bill will be higher.
The consumer champion has been urging the UK Government to intervene and Chancellor Rishi Sunak is due to make a statement tomorrow in a 'mini-budget' Spring Statement.
