Consumer champion Martin Lewis has issued an urgent call to action for British households following Ofgem's confirmation that the energy price cap will increase from the start of January.
Price Cap Changes Explained
The Money Saving Expert detailed that while the overall price cap rises by 0.2% from January 1, 2026, the reality is more complex for many consumers. Electricity costs are seeing significant increases while gas prices are falling, creating what Lewis describes as a "perverse" situation that could particularly impact those with high electricity usage.
According to the latest figures shared by Lewis on X, the new rates for average direct debit customers will be:Electricity unit rates increasing by 5.1% to 27.69p/kWh, while standing charges rise 2.0% to 54.75p per day. Meanwhile, gas unit rates will decrease by 5.7% to 5.93p/kWh, though gas standing charges increase by 3.1% to 35.09p per day.
Who Will Be Hit Hardest?
Lewis explained that households relying heavily on electricity with little or no gas usage could see their bills increase by three to four percent in January. This disproportionate impact stems from policy decisions that load additional costs onto electricity rather than gas.
"These changes are not caused by an increase in wholesale costs," Lewis clarified, noting that wholesale prices actually decreased during the assessment period. Instead, the increases come from policy and network costs including nuclear power expenses, network connection fees, and the Warm Home Discount scheme.
The Crucial Action Every Household Should Take
Martin Lewis's essential advice for consumers is clear: Use comparison websites to find cheaper fixed deals. He specifically recommended visiting CheapEnergyClub.com to explore options that could save households approximately 10% compared to the price cap rates.
"The best move for most people is to get onto a comparison site," Lewis advised, though he noted that some even cheaper tariffs might launch in the coming week, suggesting households might want to wait briefly before committing.
Looking beyond January, the Money Saving Expert website indicates analysts predict the price cap could rise again by around 5% in April 2026, primarily due to expected increases in network and policy costs, making timely action even more crucial for budget-conscious households.
