Millions of Brits are struggling to pay their energy and other household bills as the cost of living crisis grows.
Many are cutting back usage on gas and electric since the cap hike in April, but now analysts at Cornwall Insight have predicted that October could see the cap rise to 81 per cent – and going up further in January.
That’s an unprecedented rise to £3,582 before another climb to £4,266.
There are no fixed rate energy tariffs lower than the energy price cap, which leaves many people wondering whether to stick with their provider or risk paying more now in the hope that it will be cheaper than what could be coming next year.
Can I switch energy providers and fix my bills?
Until the energy crunch arrived, the advice was simple: people were urged to switch energy providers regularly to get the best deal possible.
Unfortunately, this isn’t great advice at the moment with the current energy market looking drab.
Switching providers now will not get you a competitive deal. Most are priced considerably higher than the energy price cap.
In 2021, the wholesale cost of gas suddenly increasing meant that 29 energy companies went bust, which meant millions of customers were forced to go with companies that they didn’t choose. This was exacerbated by Russian’s invasion of Ukraine.
What is the energy price cap?
The price cap was introduced in January 2019 by regulator Ofgem, to create a limit for the prices gas and electricity providers could charge those on their default variable tariffs.
It limits what you pay for each unit of gas and electricity that you use, plus it sets a maximum daily standing charge (what you pay to have your home connected to the grid).
It was designed as a safety net for those who didn’t switch providers to find cheaper bills, but as costs have soared and the energy market has seized up it has become a consumer lifeline.
The price cap is set by Ofgem in line with energy market pricing and other costs and was adjusted twice a year but will soon be changed quarterly.
How do I know if my meter readings are right?
Giving regular, accurate readings to your energy supplier – if you don’t have a smart meter that does this automatically – is the only way to ensure a correct bill.
If you don’t provide readings your provider will estimate what they think you’ve used and charge you based on that. If your bill is bigger than you think it should be, it could be because:
- *your energy supplier has increased prices
- * your usage has risen
- * your bill is based on an actual meter reading, rather than an estimated reading
- * you haven’t been paying enough to cover your usage each month
Energy saving tips
The Energy Saving Trust has said that these tips could save a typical household the following costs per year:
1. Switching appliances off standby: £55
2. Making gaps draught-proof: £45
3. Turning off the lights: £20
4. Washing at 30 degrees and reduce use by one run a week: £28
5. Avoiding using the tumble dryer: £60
6. Limiting showers to four minutes: £70
7. Swapping one bath a week for a shower: £12
8. Not overfilling the kettle: £36
9. Reducing your dishwasher use by one run a week: £14
10. Insulating your hot water cylinder: £35
