January to March heating bills set to soar
The price comparison site warned that typical monthly direct debits could increase from £86 to £111 a month because of increased heating costs.
In the first quarter of the year, households typically consume almost 30% of their annual energy making it the most expensive quarter of the year.
This, combined with the added cost of spending more time at home and the cold snap from Storm Darcy, could see many households face a shock bill of £113 more than would be expected for this period.
Typical households paying £1,042 per year by direct debit, Ofgem’s current energy price cap level, could see their energy supplier increase their monthly payment from £86 per month to more than £111 to cover the additional cost.
Compare the Market says rising usage is leaving households worried about how they will afford increasing costs.
Its Household Financial Confidence Tracker shows that nearly a third (30%) of families with children at home said they had struggled to pay their bills each week.
In addition, 29% of families with children at home said they are worried about their ability to meet their financial obligations over the coming weeks – more than double the proportion (14%) of families without kids in the house who said they had the same concern.
Peter Earl, head of energy at Compare the Market, said: “A cold snap plus the extra energy costs of working from home in lockdown means households could be facing a significant bill shock this quarter. However, many may not realise how much extra energy they’re using during lockdown, until they give an actual meter reading to their supplier, which could add to the shock.
“Not only are households facing increased costs due to spending more time at home, Ofgem has also allowed energy suppliers to substantially hike their bills in April through the energy price cap. Considering the significant strain on some household finances because of the pandemic, the increase to the cap could not have come at a worse time.”