The energy price cap will increase from the current £1,971 to £3,549 from October 1, regulator Ofgem has announced.
The regulator also warned that energy prices could get “significantly worse” next year.
It said that some suppliers might start increasing the amount that direct debit customers pay before October 1, to spread out payments, but any money taken by suppliers will only ever be spent on supplying energy to households, Ofgem added.
“The price of energy has reached record levels driven by an aggressive economic act by the Russian state,” Ofgem chief executive Jonathan Brearley said.
“They have slowly and deliberately turned off the gas supplies to Europe causing harm to our households, businesses and wider economy.
“Ofgem has no choice but to reflect these cost increases in the price cap.”
Chancellor Nadhim Zahawi said he acknowledged that the energy price cap rise “will cause stress and anxiety for many people” but insisted Government “help is coming”.
“I know the energy price cap announcement this morning will cause stress and anxiety for many people, but help is coming with £400 off energy bills for all, the second instalment of a £650 payment for vulnerable households, and £300 for all pensioners,” he said.
“While Putin is driving up energy prices in revenge for our support of Ukraine’s brave struggle for freedom, I am working flat out to develop options for further support.
“This will mean the incoming prime minister can hit the ground running and deliver support to those who need it most, as soon as possible.”
The chief executive of Ofgem urged the incoming prime minister to “act further” to tackle the impact of price rises as he announced that the energy price cap will be hiked by more than 80%.
Jonathan Brearley said the Government would need to add to the support it announced in May when bills were only expected to jump to £2,800.
“The Government support package is delivering help right now, but it’s clear the new prime minister will need to act further to tackle the impact of the price rises that are coming in October and next year,” Mr Brearley said.
“We are working with ministers, consumer groups and industry on a set of options for the incoming prime minister that will require urgent action.
“The response will need to match the scale of the crisis we have before us. With the right support in place and with regulator, government, industry and consumers working together, we can find a way through this.”
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