Martin Lewis issues warning for households worst hit by Ofgem price hike

Martin Lewis has shared a warning for the households who will be most impacted by the energy price cap rise and what to do about it.

It comes after energy regulator Ofgem announced that the energy price cap would be rising by 0.2 percent from 1 January, 2026, going up to £1,758. It's worth noting that the increase only applies to people who aren't already on a special or fixed tariff.

However, the money saving expert has since explained that the price cap rise is actually a 'red herring,' and the true figure is unfortunately much higher.

Appearing on ITV's Good Morning Britain, the financial journalist said 'it does not mean what people are saying,' because electricity units are going from 26.3p to 27.7p, which is a rise of 5.1 percent, meanwhile gas is going down by 5.7 percent. The electricity standing charge is increasing by 1p which is around 2 percent and the gas standing charge is going up 3 percent.

Based on that knowledge, the kind of power you use in your home will make a big difference as to how much you're likely to be impacted by the price hikes, with homes that are solely run on electricity being the worst affected.

"Someone who's a heavy electricity user and doesn't use gas is likely to see on average a 3 or 4 per cent rise coming on the 1st of January," Lewis explained.

"So this whole idea that there's a typical use figure and there's a typical household, and the rise is 0.2 percent.. actually, what's going to happen to you depends very much on your energy makeup."

When announcing the hike, Ofgem claimed that households should see a price increase of around 28p per month, for the average duel-fuelled home in England, Scotland and Wales, but as Lewis has explained, there are many variables to that fact.

The regulator also said that when adjusting for inflation, the new price cap is actually £37 lower than the price cap increase we saw between January and March of this year.

So, what can you do about it? Well, taking to X, the money saving expert said the 'best move' for the majority of people is to use a comparison site to find themselves a 'cheap fix,' however, he did say 'a couple of cheaper tariffs may launch next week'. So, it might be best to wait until then. There are many cheap fixes that are currently 10 percent less than the price cap.