Although the July price cap means lower bills for many households, experts predict that this is not set to last. That’s because the ongoing gas crisis is set to cost households another £600 a year from this winter,
July 1st Price Cap
The July 1st price cap change brings some positive news for UK households, with a 7% drop. The cap will impact gas and electricity prices for all those on variable tariffs in England, Scotland, and Wales. The energy price cap for a typical household paying by Direct Debit has gone down from £1,690 to £1,568 per year thanks to the price cap change. This is a reduction of £122, or around 7%, and is the lowest the cap has been for two years.
However, this relief has been described by experts as “temporary”, as prices are set to rise again in October.
The Gas Crisis
Energy prices have fallen since summer 2023 and have fallen again this month. But they remain considerably higher than pre-‘energy crisis’ levels.
Current predictions forecast an increase in the October price cap of over £150 to £1,724 . With energy bills expected to remain at higher levels until October 2025, households could end up paying With bills expected to remain at around that elevated level until October 2025. This means that the UK will be entering its fourth year of the gas prices crisis. As a result, households could end up paying an extra £600 over the 12 months from October 2024.
This means that most UK households will not be better off compared to pre-energy crisis levels, despite the brief reduction in energy bills. By September 2025, the average household could have paid almost an extra £2,600 on energy bills during the ongoing gas crisis.
Colder Homes Hit Even Harder By The UK Gas Prices Crisis
It’s even worse news for the homes that are already hard to heat. Households that are less energy efficient cost more to keep warm, and are damaged even further by the crisis.
Households with poor energy efficiency are being hit even harder. Homes with an EPC rating of E will be paying around £2,060 over twelve months when prices rise again in October.
Get Support Throughout The UK Gas Prices Crisis
It seems that despite some temporary reductions, energy bills will remain difficult for many across the UK. Those struggling the most will be worst hit, especially as the forecast increase is set for the colder and winter months.
Luckily, there is some support available for struggling households. At Energy Advice Helpline, our mission is to help people save money on their energy bills. One of the ways we do this is by helping you access government-backed grants and schemes. These schemes help you upgrade your home to be more energy efficient, meaning you can save hundreds off your energy bills per year.
With the ECO4 scheme, you can get free solar panels, insulation, and an air source heat pump. These measures are worth up to £75,000. If you qualify for ECO4, you’ll get these upgrades installed completely free of charge – you don’t have to pay a single penny!
You can check if you qualify for ECO4 in just 30 seconds by clicking on the button below.
If you don’t quite qualify for the ECO4 scheme, don’t worry! You might qualify for other government-backed schemes, such as the Great British Insulation Scheme (GBIS). With this scheme, you can get your home insulated for free. This saves the average household £300 off their energy bill per year.
To check if you’re eligible for the Great British Insulation Scheme, click the button below.
