Energy regulator Ofgem has announced its new price cap for the last three months of the year.
The price cap sets a maximum on what energy suppliers can charge customers on default tariffs for every unit of energy and the standing charges. A typical UK dual-fuel household can now expect to pay £1,755 for its annual energy needs, a rise of £35 on the current level.
While the wholesale costs of gas and electricity have generally driven rises over recent years, this is not the case here. Ofgem said in its announcement that there had been rises in some:
“…costs of transporting energy in Great Britain (England, Scotland and Wales). Network operators are adjusting costs based on the level set by the National Electricity System Operator so that electricity supply is secure. Other costs that go towards government schemes and essential support are also a factor for this increase.”
Households that qualify for the newly expanded Warm Homes Discount will see £150 credited to their accounts. Despite the rise, Ofgem pointed out that prices will be 0.9% lower in real terms than the same period last year after accounting for inflation. Ofgem says that about a third of households were also on fixed deals now and will be unaffected by the rise.
Nevertheless, households will be facing another winter of relatively high energy bills. Xgas can potentially help with this by replacing a very old boiler with a much more efficient condensing boiler installation in Chester. Find out how you could also spread the cost with financing plans.