Fears of higher bills came true this morning as Ofgem has confirmed that the energy price cap will rise again in January, in a devastating blow for millions across the UK. This will mark the second energy bill rise this winter.
Those paying by direct debit and using an average amount of energy will see their annual costs rise to £1,738. This is £21 more than October’s rates and over 50% higher than pre-COVID levels.
This comes amid warnings from charities that high bills have forced many to forgo heating during cold weather, with particularly severe impacts on families and people with disabilities.
Energy bills at a constant high
The energy price cap, set quarterly by Ofgem, limits the unit cost of energy for 26 million households in England, Scotland, and Wales. However, a cold winter could still lead to higher overall bills due to increased usage.
Although prices are 10% lower than this time last year, the continued high costs have driven up household debt. Analysts predict this trend will persist, creating a “new normal” of elevated energy prices.
From January, the price cap sets gas at 6.34p per kWh and electricity at 24.86p per kWh, with a typical household using 2,700 kWh of electricity and 11,500 kWh of gas annually. Standing charges remain mostly unchanged.
Energy costs to remain a “challenge”
“While today’s change means the cap has remained relatively stable, we understand that the cost of energy remains a challenge for too many households.”
Tim Jarvis, Director of General Markets at Ofgem
This announcement will put even more strain on the 6 million households already living in fuel poverty.
Where you can get support
Energy Advice Helpline is a not-for-profit, Community Interest Company, supporting households across the UK to reduce their energy bills and improve their energy efficiency. We provide access to a range of government-backed grants and schemes, as well as offering support through a UK-wide network of partners, covering energy supply, solar, heating and insulation.
We understand that this announcement will cause concern for many. If you’re struggling, please reach out to us on 0330 822 4168 to see if you qualify for a government-backed home energy grant. These grants save the average household hundreds off their energy bill each year, and make your home cheaper and easier to heat. Alternatively, click the button below to check if you’re eligible.
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