Martin Lewis explains to ITV News the 'devastating' impact of the 'simply unaffordable' price hikes Britons are facing this autumn
The latest predictions estimate the energy price cap will increase by 77% on October 1 to £3,500, and in January next year it will rise even further.
This means Britons will see a £1,500 a year hike in bills which is "simply unaffordable for millions of homes" and is likely to put upwards of 10 million people into fuel poverty, Mr Lewis warns.
"The impact of it is frankly catastrophic and intervention is needed, and needed now," he said.
Mr Lewis urged the government to grasp the issue, adding: "What we need is a willingness to take action and to grasp this, to make sure there are millions of people in this country who don't face the choice between starvation and freezing this winter, and it's looking like that is a realistic choice if nothing is done for many."
Russia, which is one of the biggest energy suppliers in the world, is largely behind the crippling price hikes. It is steadily choking off supply lines amid the West's sanctions over the war in Ukraine.
Here's everything you need to know about the cause of the price hikes, what can be done about them and if there is a possibility of them coming down any time soon.
Martin Lewis warns consumers there are 'very few solutions' to bringing their energy bills down and instead advises to try to start saving now for the winter
How does Russia's invasion of Ukraine affect your gas prices?
Russia supplies 40% of the EU’s natural gas via several pipelines running from Russia to Europe.
As well as natural gas, Russia is the biggest supplier of oil to Europe.
In May, after the Russian invasion of Ukraine, the EU agreed to ban all imports of Russian oil by sea by the end of the year.
Countries which are most reliant on Russian gas, such as Germany which imports about 55% of its gas from Russia, are particularly vulnerable to disruptions in supply.
The UK imports less than 4% of its gas from Russia but because energy markets are global, it is still affected by price rises.
Recently Russia restricted gas flows to Europe which have caused prices, which were already high, to rise further.
Prices spiked most recently after Russia dropped the flow of gas through the Nord Stream pipeline which runs from Russia to Germany.
In June, Russia cut gas flows through this pipeline to 40% of normal capacity, saying there was an issue with the delayed return of a gas turbine because of western sanctions imposed by the EU and United States against Russia for invading Ukraine.
Gazprom, the Russian company which is the main operator of the Nord Stream pipeline then shut the pipeline down for 10 days in July for annual maintenance.
Gazprom resumed gas flows at 40% of normal capacity and announced this week that it was dropping gas flows again, to about 20% of the pipeline’s capacity, because of a ‘technical condition’ with a turbine engine.
Correspondent Rebecca Barry examines whether Russia is using gas to retaliate against Western support for Ukraine
Why is Russia doing this?Russia is one of the biggest energy suppliers in the world and can use this power as a tool to pressure governments over Ukraine.
“The more economic pain Europe suffers, the better it is for Russia because that will drive home the costs of supporting Ukraine as it defends itself against Russia’s invasion,” Keir Giles an expert from the Chatham House think tank told ITV News.
“The less support there is for Ukraine to continue this war, the more likely it is that Ukraine will come under some kind of pressure to reach some kind of ceasefire. Ukraine depends completely on western support and backing to withstand Russia’s onslaught. Take that away and Russia wins.”
Russia’s Foreign Minister Sergey Lavrov said that Russia is expanding its military objectives in Ukraine and that it wants to take control of the entire southern part of the country.
Recently, President Vladimir Putin compared himself to one of Russia’s great leaders, Peter the Great, and suggested he was returning ancestral lands to Russia by waging war in Ukraine.
By disrupting gas supplies President Putin is hoping to pressure western countries to get Ukraine, and the world, to recognise the territory he has seized in Ukraine as being under Russian control.
What is the impact on the UK and Europe?
Reduced gas supplies mean prices are higher because many countries are trying to source alternatives elsewhere.
Even though the UK does not import much gas from Russia, gas prices have almost doubled over the last year. In Europe, the EU has warned Russia may turn off the gas taps completely this winter which would push prices up even more.
In the UK, the energy price cap which limits the rates a supplier can charge for default prices has already gone up and will go up again in October.
“This will take someone on typical usage from the current £1,971 a year, which was already up by over 50%, to £3,500 a year. In January, it will go up again,’ Martin Lewis from Money Saving Expert told ITV News.
“This £1,500 a year price spike is simply unaffordable for millions of homes and is likely to put around 10 million people or more into fuel poverty.
"The impact of it is frankly catastrophic and intervention is needed and needed now.”
If nothing is done by the government to tackle the issue many will 'face the choice between starvation and freezing this winter', warns Martin Lewis
What can be done about high gas prices?
There is no easy answer to this question. Delivering emergency one-off payments to households, council tax rebates or cutting VAT have all been suggested as steps the government could take to lessen the economic pain of the energy crisis on households.
There are concerns that if this winter is particularly long or cold, that millions of people will not be able to cope.
“What we need is a willingness to take action and grasp this problem.” Martin Lewis said.
“We need to make sure there are not millions of people in this country who do not face the choice between starvation and freezing this winter.
"It looks like that is a realistic prospect if nothing is done.”
Thus far the government has announced that all households in October will get £400 off their energy bills in the form of a grant which does not need to be repaid.
Some people on means tested benefits can get an additional £650 split into two payments in July and October.
People with disabilities may be eligible for £150 and pensioners who receive a winter fuel allowance payment can get an additional £300.
Rishi Sunak and Liz Truss, the two candidates vying to be the next Prime Minister have also suggested additional measures to deal with rising energy prices.
Rishi Sunak has suggested removing VAT at 5% on energy bills and Liz Truss has mooted scrapping the green levy – a charge of approximately £154 added to energy bills which goes towards paying for green energy policies.
Will there be supply issues over winter?
To stave off a total gas crisis, some EU countries have agreed voluntarily to reduce their gas consumption by 15% from August 2022 to March 2023.
The EU recently ordered that EU countries must fill their gas storage to 80% of capacity before this winter. Currently storage levels are around 66%.
Lower levels of gas supplied from Russia mean that countries are struggling to fill gas storage facilities ahead of winter. The UK has enough capacity to store around 12 days of gas, which is less than some EU nations.
The UK gets 50% of its gas from UK gas fields and the government says the UK energy price crisis is due to high global prices for oil and gas, not because of supply issues.
However, if Russian gas is turned off and more countries compete for supplies, it could impact the UK.
The National Grid’s Electricity System Operator which oversees the UK’s electricity supply has warned that because supply is expected to be tight, prices could be “very high.”
National Grid ESO said it expected one of the tightest periods to be in early December and that it had asked coal power plants to be on standby to provide back-up power.
However, if Russia cuts off gas completely there are concerns that gas supplies within some nations will have to be cut.
There are fears that, in the event of a total Russian gas shutdown, companies across Europe – from steelmakers to the chemical industry - may have to halt production which could tip Europe into a recession.
Should the west just agree to Russian demands in Ukraine in order to lower energy prices?
One way to reduce prices for both gas and oil, of which Russia is a major global supplier, is to increase energy supplies in order to drive the price down.
One option could be for key energy producing countries such as Saudi Arabia and the United States to pump more oil and provide more gas.
Another could be to invest more in renewable technologies and to transition more quickly towards renewable energy sources.
A third option could be to lift sanctions on Russian energy and to restore Russian gas flows.
Right now, the west is in a game of brinkmanship with Russia: Russian state television tells ordinary Russians that high energy prices may lead to mass public discontent in Europe, forcing national governments to back down over Ukraine.
The hope in Moscow is that this will lead the west to stop financing Ukraine in its fight against Russia, forcing Ukraine into some sort of ceasefire, or peace, agreement. This is something which Ukrainian officials have said would be unacceptable.
However, experts say a high price will also be paid if the west blinks and capitulates to Russia.
"By cutting gas supplies, Russia is demonstrating that it is not a reliable partner,” Keir Giles from Chatham House told ITV News.
“Whether Putin wins with his strategies of blackmail against the west - whether it’s gas to Europe or blockading food supplies from Ukraine so they can’t reach Asia and Africa - depends entirely on the will of the rest of the world. The question is whether the rest of the world will stand up to this blackmail and Russia’s war of aggression.
"Without that, if Europe capitulates and the rest of the world puts pressure on Ukraine to surrender, Putin wins. If that happens he will only be encouraged to do this again in the future.”