Get ready for some bad news – the Energy Price Cap is due to be unveiled imminently. UK households are being warned to prepare for the announcement on Friday, which is likely to have implications for their bills.
The worrying thing is that bills are predicted to surge by 9%, or £146 annually. This will deliver another hit to families nationwide as we approach the colder months, when gas and electricity usage typically increases.
The price cap will be declared by industry regulator Ofgem and is set to take effect from October. And it will undoubtedly frustrate households, given that the cap was only reduced in July.
It all means that households consuming an average amount of gas and electricity can expect to pay £1,714 annually from October, according to expert predictions. That’s £146 more than the current average annual bill of £1,568, reports Birmingham Live.
It also signifies that the cost of living pressures are far from over for millions of Brits as another winter looms. It’s likely that energy companies will increase offers to customers regarding fixed tariffs.
Many customers may wish to capitalise on these offers and maintain their current charges. However, experts caution that fixed tariffs may not always be the best long-term solution and emphasise the importance of thorough research.
Fixed tariffs can offer a degree of certainty about future bills over a certain period. Both British Gas and Eon have reached out to customers with options for fixing tariffs.
What is the energy price cap?
According to Ofgem, between 1 July to 30 September 2024 the energy price cap has been set at £1,568 per year for a typical household who use electricity and gas and pay by Direct Debit. They say this is £122 lower than the cap set between 1 April to 30 June 2024 (£1,690).
The price cap is based on typical household energy use, Ofgem says. It also aims to make sure that prices for people on a standard variable tariff (default tariff) are fair and that they reflect the cost of energy, Ofgem says.
You are covered by the price cap if you pay for your electricity and gas by either:
- standard credit (payment made when you get your electricity and gas bill)
- Direct Debit
- prepayment meter
- Economy 7 (E7) meter