Energy bills for Britons will remain ‘volatile for some time to come’, regulator Ofgem warned today as it confirmed the price cap will fall after wholesale costs dropped.
The cap will drop from an average of £2,074 per year to £1,923, but campaigners said bills remained unaffordable amid calls for an ‘urgent reboot’ of the energy market.
Ofgem will cut the price a supplier can charge for gas from 6.9p per kilowatt hour (kWh) now to 6.89p from October 1. Electricity will fall from 30.1p per kWh to 27.35p.
But millions of UK households are still expected to pay more for their energy this winter than they did a year earlier – and Ofgem’s chief executive Jonathan Brearley said that while prices are ‘much more stable this year’, the market is still ‘very tight’.
The average household bill will now end up at around £1,923 per year, according to Ofgem’s calculations. Customers on prepayment meters will pay £1,949 on average.
The cap is the per unit charge, so people using more will pay more. It is based on an estimated 2,900 units of electricity and 12,000 units of gas for the average home.
The drop in the cap for England, Wales and Scotland appears at first glance to be good news for households. Last winter the cap was de facto superseded by the Government’s Energy Price Guarantee which kept the average bill at £2,500.
But on top of that the Government was also paying about £66 per month towards each household’s energy bill. This support is not there this winter, meaning many households will be paying more every month this winter than they were last winter.
And the Resolution Foundation think tank warned that over a third of households across England, 7.2 million in total, would still face higher bills this winter than last.
Mr Brearley told BBC Radio 4’s Today programme: ‘I would love to come on this show and tell you that prices are going to fall. But the truth is that the market is still tight.
www.dailymail.co.uk/news/article-12444233/Energy-bills-Brits-face-paying-winter.html