The chief executive of Centrica PLC (LSE:CNA), British Gas’ parent company, warned that energy bills could rise again in Autumn, just a day after Ofgem announced a 54% increase to tariffs from April, an average £693 increase for households per year.
Ofgem, the British gas and electricity regulator, is currently set to review the caps once again in August, with any changes to come into effect in October.
Speaking to Sky News, Centrica boss Chris O’Shea said that “the forward market at the moment, which is the best indication, tells us that there may be a further increase.”
Currently, caps are reviewed every six months, however, Ofgem said it has opened a consultation on a proposal to review prices quarterly, as well as reduce the advance notice that tariffs take to come into effect.
Ofgem say updates every three months would reduce volume risk in falling and rising markets, with consumers seeing smaller but more frequent changes.
"We are consulting on a number of changes to the price cap methodology in response to the recent unprecedented rise in wholesale market prices and volatility," it said.
The regulator is also considering reducing the advance notice it gives to suppliers, currently two months, which it says will “reduce the volume risk faced by suppliers,” which should reduce prices to consumers.