Households across the UK are bracing for higher energy bills as Ofgem, the energy regulator, has announced a 10% increase in the energy price cap. The new cap means that the average annual energy bill for households will rise to £1,717, affecting millions of consumers already struggling with the cost of living crisis.
The price cap, designed to protect consumers from excessively high energy prices, limits the maximum amount energy suppliers can charge per unit of gas and electricity. However, with rising wholesale energy costs, the cap has been adjusted to reflect these increases. For context, the energy price cap was initially introduced in 2019 and was intended to provide a safeguard for customers on default tariffs. Over the last two years, the cap has fluctuated significantly, responding to changes in the global energy market.
According to Ofgem news , this 10% hike will impact approximately 29 million households across the UK, many of whom will see their energy bills spike as the colder months approach. In comparison, the previous cap, set at £1,565 annually, provided some relief to consumers over the summer. However, as winter nears and heating demand increases, households will feel the brunt of this change.
Martin Lewis, a consumer finance expert, warns that the rising energy costs could push more households into fuel poverty, with a growing number of families unable to afford adequate heating during the winter. Charities and consumer groups are urging the government to provide additional support for vulnerable households, emphasizing that further increases could exacerbate financial hardships.
In response, the UK government has introduced energy-saving schemes and grants to help reduce energy consumption, but critics argue more needs to be done to protect the most affected.
