Energy price cap expected to soar again to around £2,800, according to regulator Ofgem

The energy price cap is expected to soar again to around £2800 later this year.

It comes after the cap rose by almost £700 in April for millions of people across the UK.

Ofgem chief executive Jonathan Brearley told MPs at a committee on Tuesday the regulator expects to see the rise in October.

The price cap is updated twice a year and tracks wholesale energy and other costs.

On April 1, energy bills soared by around 54% when the price cap was increased.

The Ofgem Chief Exec has told MPs the price cap will rise c42% in Oct putting typical use to £2,800/yr. I'm glad he's been open about this, I asked last week for them to publish forward guidance.

This is higher than analysts predictions of £2,600 (both bloody awful though)
— Martin Lewis (@MartinSLewis) May 24, 2022

At the time, government analysis estimated the increase could mean a further 211,000 households in Scotland would not be able to afford to power or heat their homes.

The price cap aims to stop energy companies from making excessive profits and to ensure that customers pay no more than a fair price for their energy.

Speaking at Westminster’s Business, Energy and Industrial Strategy Committee, Brearley acknowledged that it is a “distressing time” for customers.

“I am afraid to say conditions have worsened in the global gas market since Russia’s invasion of Ukraine,” he said.

“Gas prices are higher and highly volatile. At times they have now reached over 10 times their normal level

“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.”