Ofgem is increasing the energy price cap by 6.4% in April, impacting 22 million households across Britain, it was announced yesterday.
From 1 April, a typical gas and electricity bill will increase by £111 per year to £1,849 for an average household, over a three-month period.
This is the third consecutive quarter that the price cap has been lifted, and is 9.4% higher than this time last year.
The cap sets a price limit on the standing charge and the unit of gas and electricity, but does not set a limit on the final bill – the more you use, the more you pay.
The increase will coincide with other household cost increases like water and council tax in many parts of the country.
Ofgem chief executive Jonathan Brearley acknowledged this was an unwelcome announcement and urged families to move to fixed tariffs.
Brearley also explained some of the reasons behind the continued pressure on prices.
On the Martin Lewis Show yesterday evening, he said: “Before the war in Ukraine, there was a lot of gas and there has been for 20 years, that market was very stable and very trustworthy.
“Since then, we have seen a massive increase in that international price.
“I don’t control that, the British government don’t control that, we are dependent on the actions of other countries.”
While prices have dropped since the invasion, households are paying an estimated £600 more annually than before the energy crisis began.
Analysts predict a slight drop in the price cap in July 2025 due to negotiations between Russia and Ukraine, but rates are still being decided by ever-more unpredictable geo-political situations, like conflict in the Middle East, and Trump’s ‘drill, baby, drill’ pledge.
Ed Miliband, secretary of state for energy security and net zero, told Sky News: “The only way we can have the energy security that British people deserve is by getting off fossil fuels that are controlled by petrol states and dictators.”
However, today, BP announced cuts to renewable energy investments, returning to a focus on increased oil and gas production.
For those struggling with the continued cost increases, the Government has proposed an expansion to the £150 Warm Home Discount payment to 2.7 million more low income households, as announced by Milliband yesterday.
Miliband told Sky News: “This government is determined to act.”
For more information on the energy cap and to assess how it may impact you, visit: https://www.moneysavingexpert.com/utilities/what-is-the-energy-price-cap/
Join the discussion