Research from Uswitch has found that the new energy price cap, to be announced in February and come into effect from April 2025, could cost households around the UK nearly £3 billion in higher energy costs.
The 26 million households on the standard variable (or “default”) tariffs affected by the price cap rising and falling could see their bills rise around £109 per year on average, with another increase currently predicted for July.
Why are energy prices rising?
Energy prices are affected by the cost of wholesale energy, which is higher now than it has been for the past 15 months. This is because of ongoing global instability which could affect supply chains, and a higher demand for gas and electricity over the colder months.
What can customers do to save money?
Customers can save on their energy bills by switching to a fixed deal, which will save money against price-capped tariffs now, but present greater savings when the price cap goes up in April and then potentially again in July.
Elise Melville, energy expert at Uswitch, comments: “If you haven’t switched energy lately, you are likely to be already paying over the odds, and the coming price hikes will only make things worse.
“Now is the time to take action, before the price rises hit. Any deal that is priced at, or below, the current cap level is likely to save you money over the coming year.
“If youʼre not ready to fix, then consider a tariff that guarantees a discount on the price cap, whether it rises or falls. EDF’s market-leading tracker promises a saving of £100 against the price cap over 12 months. The discount is applied to dual fuel standing charges, so this deal is particularly suited to households that use less energy.
“Standard tariffs are now the most expensive way to pay for your energy. The good news is, a better deal is out there for most homes. Right now there’s a lot of choice available and it takes just minutes to compare your options and switch to a better deal.”
How do I switch energy?
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