Latest news with #energypricecap
Sky News
23-05-2025
- Business
- Sky News
Energy price cap to dip by 7% from July, regulator reveals
Households on the energy price cap will see a 7% reduction in their average annual payments from 1 July, the industry regulator has announced. The default cap - which is reviewed every three months - will see a typical household using gas and electricity and paying by Direct Debit stump up an average annual £1,720, Ofgem said. That is down from the current April-June figure of £1,849 and reflects a reduction in wholesale gas prices. The lower cap does not affect the millions of households to have taken a time-limited fixed deal. Nevertheless, it represents some relief for families grappling the cost of living aftershock that saw many essential bills rise by well above the rate of inflation last month. Ofgem's announcement was made just days after fresh forecasts suggested that bills linked to the cap could come down further from both October and January, given recent wholesale market price trends. Prices last winter had been relatively stable until a cold snap hit much of Europe in January and early February, driving up demand at a time of weaker stocks. Other risk factors include extended EU gas storage rules and global conflicts, not least the continuing Russia-Ukraine war that sparked the 2022 energy price spike and cost of living crisis in the first place. Tim Jarvis, director general of markets at Ofgem, said: "A fall in the price cap will be welcome news for consumers, and reflects a reduction in the international price of wholesale gas. However, we're acutely aware that prices remain high, and some continue to struggle with the cost of energy. "The first thing I want to remind people is that you don't have to pay the price cap - there are better deals out there so it's important to shop around, and talk to your existing supplier about the best deal they can offer you. And changing your payment method to direct debit or smart pay as you go can save you up to £136." Please refresh the page for the fullest version.
BBC News
19-05-2025
- Business
- BBC News
Energy price cap: What next for gas and electricity bills and can I fix?
Gas and electricity bills are expected to fall in July, when a new price cap takes is likely to reverse the increase for millions of households on 1 April, under the current annual bill for a household using a typical amount of gas and electricity rose to £1,849 per year, an increase of £111, in energy price cap sets the maximum amount customers can be charged for each unit of energy, but actual bills depend on how much gas and electricity you use. What is the energy price cap and how is it changing? The energy price cap covers around 22 million households in England, Wales and Scotland and is set every three months by fixes the maximum price that can be charged for each unit of energy on a standard - or default - variable tariff for a typical dual-fuel household which pays by direct 1 April and 30 June 2025, gas prices are capped at 6.99p per kilowatt hour (kWh), and electricity at 27.03p per means the annual bill for a dual-fuel direct debit household using a typical amount of energy is £1,849 per year. Those who pay their bills every three months by cash or cheque pay £1, cap does not apply in Northern Ireland, which has its own energy market. What is a typical household? Your energy bill depends on the overall amount of gas and electricity you use, and how you pay for type of property you live in, how energy efficient it is, how many people live there and the weather all make a difference. The Ofgem cap is based on a "typical household" using 11,500 kWh of gas and 2,700 kWh of electricity a year with a single bill for gas and electricity, settled by direct vast majority of people pay their bill this way to help spread payments across the year. Those who pay every three months by cash or cheque are charged more. Should I take a meter reading when the energy cap changes? Submitting a meter reading when the cap changes means you will not be charged for estimated usage at the wrong is especially important when prices go with working smart meters do not need to submit a reading as their bill is calculated automatically. What is happening to prepayment customers? Between April and June, households on prepayment meters are paying slightly less than those on direct debit, with a typical bill of £1,803, a rise of £113 from the previous four million households had prepayment meters in January 2025, according to Ofgem. Many have been in place for years, but some were installed more recently after customers struggled to pay higher introduced in November 2023 mean suppliers must give customers more opportunity to clear their debts before switching them to a meter. They cannot be installed at all in certain households. Can I fix my energy prices? Fixed-price deals are not affected by the energy price cap, which changes every three months and can go up or offer certainty for a set period - often a year, or longer - but if energy prices drop when you are on the deal, you could be stuck at a higher price. You may also have to pay a penalty to leave a fixed deal the energy regulator, says customers who want the security of knowing what their bill will be should consider moving to a fixed deal. However, it says they should make sure they understand all the Lewis, founder of Money Saving Expert, recommends checking whole-of-market energy price comparison sites to help find the best deal. What are standing charges and how are they changing? Standing charges are a fixed daily fee to cover the costs of connecting to gas and electricity supplies. They vary slightly by 1 April, the average electricity standing charge fell from 60.97p to 53.8p but the average gas standing charge increased from 31.65p to 32.67pSome customers in London and the North Wales and Mersey region saw larger argue standing charges are unfair because they make up a bigger proportion of the bill of low energy response, Ofgem has said that energy firms must provide a choice of price-capped tariffs from winter would have a standing charge and unit rate - as is the case now - and another no standing charge but a higher unit rate. However, the proposals have been criticised as being too complicated. What help can I get with energy bills? The Household Support Fund, which was introduced in September 2021 to help vulnerable customers, has been extended until March Warm Home Discount scheme continues to offer a discount to eligible pensioners and low income government's Fuel Direct Scheme can help people to repay an energy debt directly from their benefit addition, suppliers must offer customers affordable payment plans or repayment holidays if they are struggling with suppliers also offer hardship to the winter fuel payment mean more than 10 million pensioners have not received the money this Help with bills
