Consumer champion Martin Lewis has issued a stark warning to millions of British households, branding the current energy billing system as 'perverse' and 'illogical'. The Money Saving Expert appeared on Good Morning Britain following Ofgem's announcement of a price cap increase, predicting that energy bills will continue to rise in the coming months.
The 'Illogical' Energy Price Paradox
Lewis expressed frustration at what he called a contradictory approach to energy pricing. "They want people to use more electricity and use heat pumps and get off gas," he explained during his appearance. "But what they're doing is they're making electricity more expensive and gas relatively cheaper."
This creates what Lewis describes as a fundamentally flawed system that works against the government's own environmental objectives. The expert emphasised that this pricing structure actively discourages households from switching to greener energy solutions like heat pumps, despite official encouragement to move away from gas.
Policy Costs Hitting Poorest Households Hardest
The root of the problem, according to Lewis, lies not in the actual cost of energy generation but in how policy costs are distributed. These additional charges on bills fund important schemes like the Energy Company Obligation, which provides energy efficiency improvements for low-income households.
However, Lewis argues that funding these initiatives through energy bills rather than general taxation creates an unfair burden. "If you're very very rich, your energy bills don't increase proportionately by the amount you're rich compared to somebody who has no money," he explained.
This means that lower-income households end up paying a larger percentage of their income to fund schemes intended to help them, creating what Lewis calls a 'perverse' situation where assistance programmes actually place greater financial pressure on those they're designed to support.
Price Cap Increase Confirmed
Ofgem announced on Friday 21st November that the energy price cap will increase by 0.2% for the period covering January to March 2026. This change translates to an additional 28 pence per month for the average dual fuel household.
While this specific increase might seem modest, Lewis warned that the underlying structural issues mean the overall trend remains upward. His comments come at a time when many households are already struggling with the cost of living crisis, making even small increases significant for family budgets.
Looking ahead, Lewis expressed pessimism about immediate solutions, noting that we're not in the 'what do I want to see from the budget' phase but rather anticipating further unfavourable developments. His warning serves as a crucial alert for consumers to prepare for continued financial pressure from energy costs.
