MILLIONS of households are set to save roughly £1,000 on their yearly energy bills after the new price cap was announced.
Ofgem, the energy regulator, set the new price cap for January 1 to March 31, 2023 to £4,279.
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But households are protected by the energy price guarantee (EPG) put in place by government in October this year.
Households won’t have to do anything as the EPG limits the average yearly bill to £2,500 up until March 31 next year.
The government will extend the energy price guarantee from next April but average yearly bills will increase to £3,000.
Chancellor Jeremy Hunt confirmed in the Autumn Statement on November 17 the EPG will run until the end of March 2024.
The next quarterly price cap update from Ofgem will come on February 27, 2023.
The announcement today from Ofgem means the average household will save over £1,000 on their energy bills due to steps taken by the government to shield households from high energy prices.
Energy prices have spiked in recent months following Russia‘s invasion of Ukraine.
Putin has limited supply of gas, used to make electricity, to Europe, which has meant its wholesale price shooting up.
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What does the new price cap mean for me?
Ofgem has said households don’t have to take any action as the price cap won’t actually make a difference to what they pay.
That’s because the energy price guarantee will cap the limit at which people can be charged per unit of energy.
However, this limit will increase from April 1, after the government said the average households’ bills will increase from £2,500 to £3,000.
The energy price guarantee impacts households on standard tariffs in England, Scotland and Wales, the vast majority of households.
What other bill help can I get?
The government announced in its Autumn Statement millions on benefits and Universal Credit will receive an extra one-off £900.
Eight million households currently get cost of living payments worth up to £650, but eligibility criteria could change under any new rules.
Chancellor Jeremy Hunt also said pensioners will be getting a £300 one-off payment.
The current “Pensioner Cost of Living payment” is being handed out to millions on a low income.
You qualify under the current rules if you normally get the Winter Fuel Payment, but this could change under the new rules.
The £300 cost of living payment is paid on top of the other winter support.
You’ll need to be:
- born on or before 25 September 1956
- have lived in the UK for at least one day during the week of 19 to 25 September 2022 in what is known as the “qualifying week”
Plus, struggling families are eligible for the Warm House Discount this winter.
Households in England and Wales don’t need to apply to get the cash and they’ll automatically qualify if they are receiving certain benefits.
You can read more about who’s eligible here.
There are also plenty of energy grants and schemes open to help you out if you’re struggling.
British Gas has recently confirmed that it’ll pay its most vulnerable customers grants worth £750 to help with sky-high bills.
Ask your supplier what’s on offer and how to apply, or check here:
Plus, millions of households are currently receiving support through the £400 energy rebate, which has been split into six monthly instalments.
We explain how paying for your bill in a different way might impact how you’re issued the £400 rebate here.
On top of that, you might be able to get help through the Household Support Fund, which is being issued by councils.
In other news, we reveal the six appliances that are the biggest drain on your energy bills.
Plus, Prime Minister Rishi Sunak has vowed to help families struggling with hikes in mortgage rates.
