Martin Lewis gives the lowdown on the energy price rises coming in October
This video is four days old but still well worth watching as, in it, Money Saving Expert Martin Lewis lays out how Liz Truss’s new energy price cap will affect households.
First point to make is that the £400 payment to each household is remaining in place, meaning that the cap of £2,500 is in reality one of £2,100 – if you use the amount of energy expected of you (typical usage).
There’s no word on the £400 payment being given next year, meaning households may pay the full tariff next year.
Second is that the cap applies to standing charges and unit costs, meaning if you use fewer units, you will pay less – and if you use more, you will pay more.
People on fixed tariffs can switch to subsidised tariffs with no early exit penalties, if switching to those operated by your current supplier.
Here’s the clip:
What’s his verdict?
Contrasting the current price cap with what it was last winter – £1,277 – that’s significantly more. Nearly twice as much, in fact.
But Mr Lewis says it’s still better than what it was going to be.
This has caused some controversy among sections of the population.
People are saying – rightly, in my opinion – that the government has spent the whole summer scaring us with the possibility of paying nearly £4,000 per year from October 1 – and now, with this new price cap, we are expected to be grateful that the rise we’re facing now is smaller.
But it is still a price rise.
It represents a failure to protect us by a government whose only job is to do just that.
And we don’t know – yet – how Liz Truss and Kwasi Kwarteng expect to subsidise this freeze. They say the energy companies won’t pay anything from their obscene profits, so it seems likely that we – the people – will be forced to pay,
In other words, it seems likely that we have no reason to be grateful at all.
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