Ofgem: Energy price cap will rise in April
Households will pay an extra £9.25 for their electricity each month from April as Ofgem increases its energy price cap by 6.4 per cent.
The price cap – which sets a maximum rate per unit and standing charge that can be billed to customers for their energy use – will rise by £111 for an average household per year.
It means the average household is set to pay £1,849 per year for their energy, £159 higher than this time last year but £531 lower than at the height of the energy crisis at the start of 2023.
Prices topped out at record highs following Russia’s invasion of Ukraine. While the market has calmed since 2022, prices have remained volatile and are still higher than pre-crisis levels.
Ofgem said that a spike in wholesale prices accounted for four-fifths of the rise, and a small increase in policy costs and “associated inflationary pressures” accounted for the rest.
“Our reliance on volatile international gas markets has increased wholesale prices and continues to impact household bills,” Ofgem said.
The regulator encouraged all customers to “consider a fixed deal before the price cap changes”, and to contact their supplier for support if they are struggling with paying their energy bill.
Some 4m customers have moved to a fixed tariff since Ofgem’s last price cap announcement three months ago.
The government has previously used fluctuating energy prices as an opportunity to stress the importance of the UK switching to a clean energy system.
“As long as Britain remains exposed to the rollercoaster of global fossil fuel markets, we will be vulnerable to energy price rises over which we have no control,” energy secretary Ed Miliband said in November.