The energy price cap
The energy price cap was introduced in 2019 to prevent households from paying unreasonably high energy prices. Due to issues in energy supply and demand, this cap will increase by 54% from 1 April 2022.
This will cause a big increase in energy prices for:
- Customers on the standard variable rate (or a default tariff)
- Customers who’s fixed energy rate has expired
- Customers who’s supplier went bust recently.
Energy customers on a pre-existing fixed price contract will not be affected. But, they will see their prices go up when their fixed rate comes to an end.
Reducing the impact of the rise
There are a few actions that might help you to limit the increase:
- Submit a meter reading online today (31 March) to correctly identify the energy that was used under your previous rate.
- Ensure your direct debit is fair and reflects your actual usage. If your direct debit is increasing by more than roughly 54%, query this with your supplier. If you are not in debt or your energy use hasn’t greatly increased recently, you may be getting overcharged.
- It’s probably best not to agree a new fixed deal. Fixed deals aren’t protected by the cap, and every deal available right now is more expensive than the cap. Keep an eye on the fixed deals available over the coming months as the energy crisis hopefully subsides.
- Do not try to switch suppliers. Very few suppliers are taking customers, and none at anything other than the maximum prices allowed by the cap.
We can’t escape the fact that costs are going up. The best action we can all take is to try to use less energy. Our energy saving guide (PDF) has information on how you can save money and energy at home.
Support to pay your energy bills
If you’re struggling to pay your bills help is available. The Citizens Advice detail the grants and benefits available to help you pay your energy bills on their website.