Latest news with #pricecap
Yahoo
26-05-2025
- Business
- Yahoo
Typical energy bill in Great Britain to fall 7% to £1,720 a year from July
Energy costs will fall for millions of British households this summer after the industry watchdog cut the price cap for a typical annual dual-fuel bill by 7% to £1,720. The energy regulator for Great Britain, Ofgem, said the cap on gas and electricity charges would fall from July by the equivalent of £129 a year for the average home after a sharp slump in Europe's gas market prices. Despite the drop, which follows three consecutive quarterly increases, the typical household will still pay about £600 a year more on their annual bill than before Russia's invasion of Ukraine three years ago. About 9m households that buy their energy through variable tariffs will see an immediate impact on their bills when the cap takes effect in July. But households could still face higher bills if they use more than the typical amount of energy. This is because the cap, which is recalculated every three months, limits the rate energy suppliers can charge customers for each unit of gas and electricity – not the total bill. Ofgem said it was able to lower the cap after a slump in gas market prices across Europe, which has helped to cut costs for energy suppliers. Ofgem has also cut the amount that suppliers can charge customers to cover their operating costs after a 'full review' of the expenses faced by suppliers since the price cap was introduced in 2019. The decision, which will be unwelcome news for suppliers, accounts for 10% of the price drop. The lower price cap is a rare dose of good news for households wrestling with a plethora of bill increases, from broadband to water, that came into force in April and conspired to drive inflation to a higher-than-expected rate of 3.5%. The benchmark price for European gas tumbled from highs of almost €58 (£49) a megawatt hour (MWh) in February to just over €31/MWh last month, while the UK gas market price fell from 138p per therm to about 78p/th. Cheaper gas means lower costs for household heating but it also lowers the cost of electricity in the UK because a large proportion of power is generated in gas power plants. Tim Jarvis, the director general of markets at Ofgem, said: '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. 'In the longer term, we need an energy system where prices are insulated from the volatile international gas market, and which ensures more stable prices and energy security. And we're working closely with government to get the investment we need to reach our clean power and net zero targets as quickly as possible.' The new price cap is likely to reignite the debate over the affordability of the UK's energy. A record proportion of British households were unable to pay their energy bills by direct debit last month because there was not enough money in their bank accounts, according to official government data. More than 2.7% of direct debit payments for gas and electricity defaulted in April because of insufficient funds, the latest figures published by the Office for National Statistics have revealed. The rising energy default figures are expected to lead to higher overall energy debt and arrears, which reached a record £3.8bn at the end of September last year. This is more than double the debt shouldered by households at the start of 2022. On Wednesday, Keir Starmer said he wanted more pensioners to be eligible for winter fuel payments after a backlash against Labour's decision last summer to limit support to the poorest households. The prime minister said he would look again at the £11,500 income threshold over which pensioners are no longer eligible for the allowance, but would not say how many of the approximately 10 million people who lost it would have it restored or if the U-turn would come into effect this winter. Ed Miliband, the energy secretary, said: 'This fall in energy bills is welcome news for families across the country and will mean that working people keep more of their money in the coming months. 'However, we know that it is only through our mission for clean, homegrown power that we can get off the rollercoaster of fossil fuel markets controlled by dictators and petrostates – and give families and businesses energy security and bring down bills for good.' The chief executive of the charity Citizens Advice, Clare Moriarty, said: 'Today's announcement will be cold comfort to the millions paying off a mountain of debt on top of their monthly costs. 'The government has said it hopes to provide more support to pensioners this winter but we know that people with children are often struggling most of all with energy. It must provide more targeted energy bill support to those hardest hit, and upgrade 5m homes with money-saving energy efficiency measures.'
Yahoo
25-05-2025
- Business
- Yahoo
Energy bills: How to make sure you find the cheapest deal
Regulator Ofgem confirmed the energy price cap is coming down from July with around a seven per cent drop, meaning average bills could fall by £129. While the usual reminders apply about the price cap relating to charges for units of energy, rather than maximum bills, it's still a big boost for households after April's rises in council tax and other costs. Ofgem's last increase came around the same time, which contributed to overall inflation in the UK increasing to 3.5 per cent in April. This is likely to have the knock-on effect of seeing interest rates remain higher for longer than anticipated. All the same, the impending reduction in energy bills will be welcome - and if you shop around rather than sticking with whatever your current provider immediately offers, there's a fair chance you could save more than £129 off your upcoming bills. If your deal is ending soon, your current provider will give you options to switch to their best tariffs, but they might not be the cheapest or most suitable ones for you overall. There are a number of options for you to begin your search, however, which don't take up too much time and could save you plenty in the long run. To start with, Uswitch should be your first port of call: enter your address, confirm your current provider, enter your email address and get the best options they have in their database. Uswitch has been running for 25 years and works closely with Ofgem to include everything consumers need to know - and they'll even do the switching for you if you find the right tariff on their site. Alternative options are GoCompare and Which?, while a less well-known site is WattsWatt - a new, privately run checker website which promises to find the cheapest energy tariff for you based on your postcode. One extra tip to save even more money: some browser add-ons or cashback sites like Quidco will sometimes offer you an extra percentage of your money back if you log in before buying. Right now on Uswitch, for example, you can get up to £26 back through Quidco if you complete a transaction to change your energy provider there. It's worth a look! While we'll list a few of the top deals around today, it is important to note that energy deals and available tariffs can change quickly depending on uptake, as well as news like Friday's. Discounts also tend to be measured against the current price cap, not the future one, and not every deal is available to everybody, so again, make sure you check around to find the one which suits you. That said... Outfox the Market's Fix'd Dual May25 12M v5.0 tariff is picked by several places as one standout deal to consider. It's a dual-fuel tariff, with a 12-month fix. Longer terms are also available. EDF has an Energy Simply Fixed May26v5 tariff available, which is ranked as the most popular on Uswitch at present. So Energy has several cropping up as good options right now, with their So Clove and So Chestnut tariffs in particular stacking up well. And if you only want electricity rather than a dual fuel switch, the Outfox the Market Fix'd Elec May25 12M v3.0 tariff may be one to consider. Always consider exit fees and term duration as well as energy unit costs. Ofgem present their latest price cap adjustments every three months. That means the next review will be confirmed on 27 August 2025, which will cover the period from 1 October 2025 to 31 December 2025. If your fixed-term deal isn't due to run out until later in the year, mark those dates and check back later to ensure you still get the best deal possible. Sign in to access your portfolio
The Independent
25-05-2025
- Business
- The Independent
Energy bills: How to make sure you find the cheapest deal
Regulator Ofgem confirmed the energy price cap is coming down from July with around a seven per cent drop, meaning average bills could fall by £129. While the usual reminders apply about the price cap relating to charges for units of energy, rather than maximum bills, it's still a big boost for households after April's rises in council tax and other costs. Ofgem's last increase came around the same time, which contributed to overall inflation in the UK increasing to 3.5 per cent in April. This is likely to have the knock-on effect of seeing interest rates remain higher for longer than anticipated. All the same, the impending reduction in energy bills will be welcome - and if you shop around rather than sticking with whatever your current provider immediately offers, there's a fair chance you could save more than £129 off your upcoming bills. Make sure to find the right deal for your property If your deal is ending soon, your current provider will give you options to switch to their best tariffs, but they might not be the cheapest or most suitable ones for you overall. There are a number of options for you to begin your search, however, which don't take up too much time and could save you plenty in the long run. To start with, Uswitch should be your first port of call: enter your address, confirm your current provider, enter your email address and get the best options they have in their database. Uswitch has been running for 25 years and works closely with Ofgem to include everything consumers need to know - and they'll even do the switching for you if you find the right tariff on their site. Alternative options are GoCompare and Which?, while a less well-known site is WattsWatt - a new, privately run checker website which promises to find the cheapest energy tariff for you based on your postcode. One extra tip to save even more money: some browser add-ons or cashback sites like Quidco will sometimes offer you an extra percentage of your money back if you log in before buying. Right now on Uswitch, for example, you can get up to £26 back through Quidco if you complete a transaction to change your energy provider there. It's worth a look! Best potential deals While we'll list a few of the top deals around today, it is important to note that energy deals and available tariffs can change quickly depending on uptake, as well as news like Friday's. Discounts also tend to be measured against the current price cap, not the future one, and not every deal is available to everybody, so again, make sure you check around to find the one which suits you. That said... Outfox the Market's Fix'd Dual May25 12M v5.0 tariff is picked by several places as one standout deal to consider. It's a dual-fuel tariff, with a 12-month fix. Longer terms are also available. EDF has an Energy Simply Fixed May26v5 tariff available, which is ranked as the most popular on Uswitch at present. So Energy has several cropping up as good options right now, with their So Clove and So Chestnut tariffs in particular stacking up well. And if you only want electricity rather than a dual fuel switch, the Outfox the Market Fix'd Elec May25 12M v3.0 tariff may be one to consider. Always consider exit fees and term duration as well as energy unit costs. Ofgem present their latest price cap adjustments every three months. That means the next review will be confirmed on 27 August 2025, which will cover the period from 1 October 2025 to 31 December 2025. If your fixed-term deal isn't due to run out until later in the year, mark those dates and check back later to ensure you still get the best deal possible.
The Independent
23-05-2025
- Business
- The Independent
Want cheaper energy bills? Here's how to get the best deals
Regulator Ofgem confirmed the energy price cap is coming down from July with around a seven per cent drop, meaning average bills could fall by £129. While the usual reminders apply about the price cap relating to charges for units of energy, rather than maximum bills, it's still a big boost for households after April's rises in council tax and other costs. Ofgem's last increase came around the same time, which contributed to overall inflation in the UK increasing to 3.5 per cent in April. This is likely to have the knock-on effect of seeing interest rates remain higher for longer than anticipated. All the same, the impending reduction in energy bills will be welcome - and if you shop around rather than sticking with whatever your current provider immediately offers, there's a fair chance you could save more than £129 off your upcoming bills. Make sure to find the right deal for your property If your deal is ending soon, your current provider will give you options to switch to their best tariffs, but they might not be the cheapest or most suitable ones for you overall. There are a number of options for you to begin your search, however, which don't take up too much time and could save you plenty in the long run. To start with, Uswitch should be your first port of call: enter your address, confirm your current provider, enter your email address and get the best options they have in their database. Uswitch has been running for 25 years and works closely with Ofgem to include everything consumers need to know - and they'll even do the switching for you if you find the right tariff on their site. Alternative options are GoCompare and Which?, while a less well-known site is WattsWatt - a new, privately run checker website which promises to find the cheapest energy tariff for you based on your postcode. One extra tip to save even more money: some browser add-ons or cashback sites like Quidco will sometimes offer you an extra percentage of your money back if you log in before buying. Right now on Uswitch, for example, you can get up to £26 back through Quidco if you complete a transaction to change your energy provider there. It's worth a look! Best potential deals While we'll list a few of the top deals around today, it is important to note that energy deals and available tariffs can change quickly depending on uptake, as well as news like Friday's. Discounts also tend to be measured against the current price cap, not the future one, and not every deal is available to everybody, so again, make sure you check around to find the one which suits you. That said... Outfox the Market's Fix'd Dual May25 12M v5.0 tariff is picked by several places as one standout deal to consider. It's a dual-fuel tariff, with a 12-month fix. Longer terms are also available. EDF has an Energy Simply Fixed May26v5 tariff available, which is ranked as the most popular on Uswitch at present. So Energy has several cropping up as good options right now, with their So Clove and So Chestnut tariffs in particular stacking up well. And if you only want electricity rather than a dual fuel switch, the Outfox the Market Fix'd Elec May25 12M v3.0 tariff may be one to consider. Always consider exit fees and term duration as well as energy unit costs. Ofgem present their latest price cap adjustments every three months. That means the next review will be confirmed on 27 August 2025, which will cover the period from 1 October 2025 to 31 December 2025. If your fixed-term deal isn't due to run out until later in the year, mark those dates and check back later to ensure you still get the best deal possible.
Yahoo
23-05-2025
- Business
- Yahoo
Martin Lewis reveals real energy bill savings in withering OFGEM price cap assessment
Martin Lewis has dismissed OFGEM's claim of average annual household savings of £129 following a 7% price cap drop as 'totally misleading'. Speaking on Good Morning Britain on the morning of the announcement (23 May), Lewis explained the figure is based on an annual saving - but the price cap is reviewed every quarter. 'OFGEM quotes this 'typical use' figure which is meaningless because nobody is average - almost everyone is above average or below average on their use,' Lewis said. 'You can't save £129 a year because the price cap only lasts three months and it'll move again in October.' The finance guru revealed a 'far better way' to calculate savings - based on every £100 spent now, versus in July, when the price cap changes come into effect.
