November 6, 2018
Ofgem has confirmed that an energy price cap will come into place on January 1st 2019, protecting 11 million customers who are currently on poor value default tariffs.
When the price cap comes into force, energy suppliers will have to cut the price of their default tariffs (including standard variable tariffs) to the level of or below the cap.
Ofgem has set the final level of the price cap on gas and electricity at £1137 per year for a typical dual fuel customer paying by direct debit. The regulator for the energy industry has claimed the price cap will save GB households around £1 billion.
How much will I save on my energy bill?
The cap will save customers who use a typical amount of gas and electricity around £76 per year on average, with a typical customer on the most expensive tariffs saving £120.
Ofgem considers a typical customer to be a medium gas user and medium electricity user (profile class 1). A medium user uses 12,000 kWh of gas and 3,100 kWh of electricity. Different cap levels will apply depending on how customers pay, where they live and their meter type.
What will happen to the cap next year?
To reflect the latest estimated costs of supplying electricity and gas, including wholesale energy costs and to ensure that those protected always pay a fair price for their energy, the price cap level will be updated in April and October every year. In February 2019, the level of the price cap will be set for April 2019.
What will energy cost after the price cap?
The per unit level of the price cap for a typical customer paying by direct debit will be 17p per kWh for electricity-only customers and 4p per kWh for gas-only customers. Standing charges are capped at £83 for electricity-only customers, £94 for gas-only customers and £177 for dual-fuel customers.
Switch energy supplier to save more money
Households protected by the energy price cap could save even more money by shopping around for a better energy deal.
To compare energy suppliers and find out what you can save visit the Energylinx website or call one of our energy advisors on 0800 849 7077. We are open Monday to Friday 9am to 6pm and Saturday 9am to 3pm.
Posted on November 6, 2018 at 10:48 AM