As Ofgem Adjusts The Price Cap System, Rishi Sunak Warns Of More Price Spikes

Households are facing the biggest financial squeeze in the UK's history, as the chancellor warned that energy costs could rise again in the autumn and Ofgem granted itself new powers.

Energy prices are likely to jump £693 to a median £1,971 per year, putting pressure on families.

However, the regulator Ofgem's announcement of a 54 percent increase may not be the only one to strike households this year.

Rishi Sunak has cautioned Britons to expect substantially higher energy expenses in the autumn, as the £1,971 price cap is expected to grow much higher.

To combat market volatility, Ofgem is revising the price cap on bills twice as frequently.

Currently, the cap on how much energy suppliers can charge is only raised every six months, and dozens of energy suppliers have gone out of business in that time.

The failures were triggered by a significant increase in the price that energy companies had to pay for the gas that they supplied to consumers.

Because the price restriction set a limit on how much suppliers could charge for the same gas, many were selling it at a loss.

Ofgem has now given itself the authority to intervene if this happens again in the next six months. It's possible that bills will rise again before October.

Even before the price hike in October, about three million homes were behind on their energy bills.