Ofgem is expected to announce that it will drop its cap on the amount energy suppliers are able to charge by around £1,000, but analysts believe bills will still rise by an average of £500.

The energy regulator is expected to announce that it will drop its cap on the amount energy suppliers are able to charge by around £1,000 to £3,295, effective from April 1, according to the latest forecast from energy consultancy Cornwall Insight.

This comes as it was revealed in January that the average Bolton household is paying almost twice as much as last winter to fuel their home, with more people in the borough seeking help from Citizens Advice.

The figures from the Department for Business, Energy and Industrial Strategy showed the average Bolton household consumed 11,858 kilowatt-hours (kWh) of gas and 2,663 kWh of electricity in 2021.

Based on prices last winter, the average Bolton household would have had an annual spend of approximately £1,220 for the same amount of energy – just over half as much.

Richard Wilkinson, CEO of Citizens Advice Bolton and Bury, said: “It is incredibly worrying, we can see in terms of the debt problems as well, there are certain hotspots that are emerging in the borough these include Great Lever, Tonge, Crompton and Halliwell, where we are seeing a concentration of clients who have approached us needing help with their debt situation.”

However, customers will pay about 20 percent more on their bills, approximately £500 as the Government’s additional support in the form of the Energy Price Guarantee (EPG) only partially protects consumers from paying the full price cap.

This support is set to become less generous from the beginning of April, rising to an average bill of £3,000.

When the upcoming end of the £400 energy rebate scheme, paid in six instalments of £66 and £67 a month is factored in, the energy cost for households will increase even more.

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Ofgem’s price cap is currently set at £4,279 per year for the average household, meaning the Government has probably been paying about £1,779 per year to energy suppliers on average for every household they serve between September and March.

The predicted fall of the Ofgem price cap to £3,295, and the rise of the energy price guarantee level to £3,000, means the Government will be paying just £295 per household per year from April to June.