- Energy price cap to rise by 2% from 1 October, adding about £2.93 to a typical household’s monthly bill
- The cap will be set at £1,755 a year – the same period last year was lower at £1,717 (0.9% lower when adjusted for inflation)
- Extension of the government’s warm home discount scheme is partly responsible for the increase, along with costs of running the network as energy prices stabilise
Danni Hewson, AJ Bell head of financial analysis, comments on the latest Ofgem energy price cap:
“News that the energy price cap is set to increase just as the nights draw in and temperatures fall will be a blow to many hard-working families.
“The cost of essentials – particularly food – has been creeping up and whilst wages have broadly stayed ahead of inflation, households are now weary of recalculating how much month seems to be left at the end of the money. Ensuring every household on means tested benefits gets help with their bills is welcome but for those just getting by, adapting to what seems to be the new normal for energy bills is tough.
“Whilst we are nowhere near the highs experienced in late 2022 and early 2023, there’s no sign of bills returning to the kind of levels we’d got used to before Russia invaded Ukraine, despite recent stabilisation in wholesale energy costs.
“There is increased competition in the market, meaning many people will be cushioned from the increases because they’ve already signed up to a cheaper fixed deal, and there are still good options out there for people who want certainty for the year ahead. Focusing on bringing more home-grown energy online must be seen as a good thing but there will be a lag, especially with so many households reliant on gas for heating.
“Over the past couple of years people have used every trick in the book to make sure their energy usage was as efficient as possible, so there will undoubtedly be families keeping everything crossed that this winter will be a mild one.”
