Average UK energy bills to fall by up to £426
The price of energy has been in the news consistently in the last year, as many UK families have struggled with rapidly increasing energy costs. In good news for consumers, energy regulator Ofgem have today announced a cut to the Energy Price Cap from July 1st 2023.
What is the average energy bill in the UK?
The current Energy Price Cap is a £3,280 maximum charge for standard energy use per year. However, due to the government’s Energy Price Guarantee, no energy customers were paying this amount for standard usage. Instead, average gas and electricity bills were capped at £2,500 per year at most (for standard usages and standing charges).
This figure is now taken over by the new Ofgem Price Cap. The cap prevents energy suppliers charging more than £2,074 per year for standard energy usage.
While this will be welcome news for many, energy bills will still be higher than in previous years. The prices charged in July will be similar to those charged last winter (when average energy use is typically higher).
There is increasing pressure on the UK government to do more to support energy customers and those facing financial difficulty during the cost of living crisis.
Will the Energy Price Cap fall again?
Various factors will affect the price cap such as wholesale energy prices. It is possible the Energy Price Cap could fall again this year and it is certainly moving in the right direction.
However, the lower price cap is still not enough to help those low-income families who are struggling.
The government ended their additional support for energy customers at the end of March 2023. This was the Energy Bills Support Scheme which gave customers a £400 discount on their energy bills.
Households can no longer access this support, though the government is still offering help to businesses through the Energy Bills Discount Scheme. This scheme will run until the end of March 2024.
Prior to the UK energy crisis, the cost of energy was lower and far more affordable overall. Many UK households are now paying more than double for their energy bills compared to 2021.
Energy bills support
If you are finding it difficult to afford your energy bills, there are several options available that could be of help:
- Cost of living support payments (available to those on eligible benefits e.g. pension credit)
- Speak to your electricity supplier as they may be able to offer additional support
- Get free advice through the British Gas Energy Trust
Here we have more articles about the latest UK financial news, energy prices and more.
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