Mon, 7 November 2022 at 4:37 pm
Martin Lewis has said there is good news and bad news for Britons in the latest energy bill forecast.
Market researchers Cornwall Insight has lowered its prediction for what electricity and gas bills will look like in April 2023 when the government’s six-month cap on energy bill payments finishes.
The Energy Price Guarantee will end next April, when the energy price cap will come back into force.
Previously, Cornwall had predicted this was to rise by 72%, but last week it forecast a 48% rise, bringing the average typical energy bill in the UK from £2,500 a year under the freeze to £3,702.
Lewis, the founder of MoneySavingExpert.com, tweeted on Monday: “Bad and good news.
“It’s early days but Cornwall Insight’s latest prediction for the April price cap (which returns then unless government changes rules) is a 48% rise; taking a (meaningless but illustrative) typical bill to £3,700 a year yr from £2,500.
“Yet it’s less than the 72% predicted before.”
He pointed out that the recent drop in gas prices was behind the lower prediction from Cornwall Insight.
The forecast means a £600 drop in the predicted average UK energy bill from next April – Cornwall had said previously it would be £4,347 a year.
While the new prediction is still much higher than the £2,500 under the government freeze, in an even earlier forecast last August, before the Energy Price Guarantee was introduced, Cornwall said the average annual bill from next April would be £5,341.
Chancellor Jeremy Hunt announced last month that the Energy Price Guarantee would be scrapped after just six months in April. Under his predecessor Kwasi Kwarteng’s plan, it had been slated to last for two years.
Last month, Cornwall predicted that energy bills would not return to normal this decade.
Tom Edwards, senior modeller at Cornwall Insight, said: “While increasing offshore wind, amongst other changes to the energy mix, have led to lower forecasts, it is important to recognise that prices could remain well above pre-pandemic levels until 2030 and beyond.
“Higher demand for renewables as gas becomes more difficult to procure, and the intensifying move towards electrification, will ultimately lead to prices stabilising at higher levels than previously predicted.”