According to sources from the BBC, some energy companies are getting ready to adjust bills, anticipating that the government will maintain its current level of support or close to it.
As of April, typical household energy bills are expected to rise to £3,000 a year, but calls have been made for the government to continue supporting them at the current level of £2,500.
While the government has said that all help for bills is being reviewed, a Treasury source declined to comment on speculation. The government is currently capping typical household bills at £2,500 a year, plus a £400 winter discount, which will end in April.
As a result of the reduction in help scheduled for April, fuel poverty campaigners believe that the number of households struggling to pay bills could rise from 6.7 million to 8.4 million.
However, some industry sources claim that some energy companies are already adjusting future bills to reflect that energy assistance will continue at or near current levels after 1 April.
So far, Chancellor Jeremy Hunt has refused to extend the support, but experts believe that he is increasingly likely to change his stance, possibly during the Spring Budget on 15 March.
According to the BBC, the Resolution Foundation think tank and consumer advocate Martin Lewis have both expressed the view that Chancellor Jeremy Hunt is highly likely to prevent the increase in household energy bills.
The Institute for Fiscal Studies (IFS) has forecasted that the Treasury could afford to maintain support at current levels until summer due to wholesale energy prices declining significantly, thereby reducing the cost of the scheme.
Energy UK, which represents suppliers, has called on the government to quickly announce the support level of £2,500 for an average household, so that firms can factor it into bills from April. Energy Secretary Grant Shapps has stated that he is “very sympathetic” to the idea of halting the planned £500 rise in bills.
The recent drop in wholesale gas and electricity prices has raised hopes that the energy crisis may be easing. The end of Covid lockdowns had led to a rise in bills, which increased further due to the war in Ukraine.
Without the government’s energy price guarantee, a typical household’s gas and electricity bill would have reached £4,279 per year from January under the energy price cap set by Ofgem, the industry regulator.
