Martin Lewis Reveals 'Awful' News For Household Energy Bills

Money-saving expert Martin Lewis has issued a stark warning about energy bills, with new forecasts suggesting millions of households could be facing a significant increase in costs from January 2027.

The MoneySavingExpert founder has described the latest predictions as "awful", warning that energy bills could rise by almost 29% at the start of the new year.

Here's what you need to know, and what you can do to prepare.

How much could energy bills increase?

According to Martin Lewis's latest calculations, the energy price cap could rise by 28.8% from January 1, 2027.

If the prediction becomes reality, the average household energy bill could increase from around £1,723 to £2,219 a year.

That's an extra £496 annually, or roughly £41 a month. Not exactly the New Year surprise anyone was hoping for!

The figures come from MoneySavingExpert's analysis of three leading industry forecasts, which take into account the cost of wholesale energy.

Martin shared the latest predictions on social media, explaining that wholesale energy prices have continued to climb in recent weeks.

He also warned that the January forecast is becoming increasingly likely as the assessment period used to calculate the next price cap progresses.

However, it's worth remembering that these are still forecasts, rather than confirmed figures. Ofgem will announce the official January price cap closer to the time.

Why are energy bills going up?

The main reason behind the predicted increase is the rising cost of wholesale gas and electricity.

Energy suppliers buy energy on the wholesale market, and when those prices increase, the costs can eventually be passed on to customers through higher energy bills.

International events and instability in energy markets can also have a big impact on prices, making it difficult to predict exactly where bills will land.

Martin Lewis previously warned that a substantial January increase was looking increasingly difficult to avoid, unless wholesale prices fell significantly.

Unfortunately, that doesn't make particularly cheerful reading as we head into the colder months.

What can you do to keep your energy bills down?

While you can't control wholesale energy prices, there are a few things you can do to avoid paying more than necessary.

1. Check whether you could get a cheaper tariff

If you're currently on a standard variable tariff, it could be worth comparing fixed-rate deals. A fixed tariff could offer some protection against future price increases, although always check the exit fees and terms before switching.

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2. Keep an eye on your energy usage

Small changes can make a difference over time. Turning appliances off when they're not being used, washing clothes at lower temperatures and keeping an eye on heating settings are all simple ways to reduce consumption.

3. Check what support is available

The Government has announced a one-off £100 energy payment for eligible households in council tax bands A to D in England, expected in January 2027. Other support, including the Warm Home Discount, may also be available depending on your circumstances.

Is there any good news?

It's not all doom and gloom. The Government has also announced plans to scrap gas standing charges from 2027, although the cost will be moved into unit rates. This means some households could pay less, while others may pay more depending on how much gas they use.

For now, the best thing you can do is keep an eye on announcements, check your current tariff and make sure you're not paying more than you need to.

Because there's nothing worse than a January financial hangover before the year has even properly got started!