Energy prices fall but millions of households face paying more this winter than last
The Ofgem energy price cap has fallen but millions still face paying more this winter than last
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Ofgem’s energy price cap has fallen, but millions of households are set to pay out more on their energy bills than they did last winter.
The lower price cap came into effect today, reducing the average energy bill from £2,074 to £1,923 for the next three months.
This is based on the typical domestic consumption values (TDCV) rate for a dual-fuel household paying by direct debit.
Despite the fall in the price cap, Britons are being warned many may find energy bills are similar to, or worse than, last winter.
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The price cap is still more than 50 per cent higher than pre-crisis levels, and Government support, such as the Energy Bills Support Scheme - which gave households a £400 discount over six months - has ended.
Last year’s measures, including the Energy Price Guarantee which subsidised the price cap to £2,500 a year for typical households, meant the average monthly cost of energy was brought down to £141.
Unless further support is announced, average costs from October to December are expected to rise to £160 a month.
Some 2.7 million families (13 per cent of households) face energy bills rising by more than £100 this winter, according to research by the Resolution Foundation.
Simon Francis, coordinator of the End Fuel Poverty Coalition, which is part of the Warm This Winter campaign, said: “Average energy bills are still almost double what they were three years ago and Government help for households, which was available last winter, has been axed.
"This means this winter will feel worse for many households.”
Mr Francis also warned households face paying more on energy standing charges. He said: “From October 1, all households in every part of the country will pay more on energy standing charges, more into the profits of energy firms and many are more in debt to their suppliers.”
Ofgem’s chief executive Jonathan Brearley told MPs last month that despite the energy market being more stable, the lack of Government support this winter means many struggling families won’t find their energy outgoings are lower.
He warned: “For many people, their bills will be very similar this year and possibly worse for some than they were last year.”
Mr Brearley said there “should be no excuses” for suppliers not to do all they can to support customers this winter.
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Commenting on the new price cap, Energy Secretary Claire Coutinho said: “This is good news for families and progress in our promise to halve inflation, as average energy prices fall again - down by 55 per cent since their peak.
"We will continue to support the most vulnerable through the winter – on top of the £40billion we provided last year to cover around half a typical household’s energy bill.
"We are committed to help families and businesses who are facing cost of living challenges, as we strengthen our energy security to deliver cheaper, cleaner homegrown power.”