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Energy bills to rise by £94 for millions of households from January as Ofgem increases price cap
23 November 2023, 07:15 | Updated: 23 November 2023, 08:21
Energy bills are set to soar for millions of households from January following an increase to the price cap.
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The average household energy bill will rise by £94 a year from January after Ofgem increased its price cap in response to rising wholesale prices.
It was also due to market instability and global events, particularly the conflict in Ukraine, the regulator said.
The price cap will go from the current £1,834 for a typical dual fuel household to £1,928 from January 1.
Chief executive Jonathan Brearley said: "This is a difficult time for many people and any increase in bills will be worrying.
"But this rise - around the levels we saw in August - is a result of the wholesale cost of gas and electricity rising, which needs to be reflected in the price that we all pay.
"It is important that customers are supported and we have made clear to suppliers that we expect them to identify and offer help to those who are struggling with bills.
"We are also seeing the return of choice to the market, which is a positive sign, and customers could benefit from shopping around with a range of tariffs now available offering the security of a fixed rate or a more flexible deal that tracks below the price cap.
"People should weigh up all the information, seek independent advice from trusted sources and consider what is most important for them, whether that's the lowest price or the security of a fixed deal."
The energy price cap sets a limit on the maximum amount suppliers can charge households in England, Wales and Scotland for each unit of gas and electricity.
The headline price cap figure is an average across households rather than an absolute cap on bills, so those that use more will pay more.
The Price Cap sets a limit on the maximum amount suppliers can charge for each unit of gas and electricity you use, including the daily standing charge.— Ofgem (@ofgem) November 23, 2023
Today we have announced what the price cap will be from 1 January 2024.
Watch our video below to find out more ⬇️ pic.twitter.com/teSelFpE6v
The announcement follows Chancellor Jeremy Hunt's Autumn Statement, in which he made no mention of any further help from the government to offset household energy billst.
Gillian Cooper, director of energy at Citizens Advice, said: "Prices going up during the coldest part of the year will make life harder for millions of people already struggling to pay their bills.
"We're already helping record numbers with energy debt and we're seeing more people than ever who can't afford to top up their prepayment meter.
"Yesterday, the Government missed the opportunity to announce extra support for households who desperately need it this winter.
"The lack of action means far too many households will now be forced to choose between heating and eating this winter.
"We urgently need the Government to honour its commitment to look at options for providing targeted financial support with energy bills from April 2024."