Mon 27 February 2023:
Energy regulator Ofgem stated on Monday that the maximum price of gas and electricity units in the UK will be cut starting in April.
As part of efforts to lower energy costs for consumers, Ofgem said the quarterly cap on bills for average dual fuel households paying by direct debit will be cut by 23% to £3,280 ($3,921) in the year’s second quarter.
Nonetheless, despite the cut, it is still anticipated that average energy costs will increase.
“From 1 April 2023, the Energy Price Guarantee (EPG) is expected to increase from £2,500 to £3,000 for a typical dual fuel direct debit domestic consumer and will will be extended until April 2024,” according to a statement from Ofgem.
“That means from 1 April 2023, a typical household in Great Britain will see an increase in their bills. However, the EPG still reflects a discount relative to the underlying price cap,” it added.
Ofgem’s chief executive, Jonathan Brearley, said: “Although wholesale prices have fallen, the price cap has not yet fallen below the planned level of the energy price guarantee. This means that on current policy, bills will rise again in April. I know that for many households this news will be deeply concerning.”
Brearley said the regulator was studying the feasibility of a social tariff for vulnerable customers with “urgency”.
Industry and consumer groups have urged the government not to increase its subsidy level to £3,000, citing cheaper wholesale energy prices that have eased the fiscal burden on the Treasury.
The energy price cap is a government initiative aimed at protecting consumers from excessively high energy bills.
It limits the maximum amount that suppliers can charge for standard variable tariffs, which is the default energy plan for many households.
The average energy bill for a typical three-bed house in the UK is approximately £1,138 per year, according to the most recent figures.
In order to get the best value for their money, Ofgem has also recommended customers to look around for the best energy prices and to think about switching suppliers.
SOURCE: INDEPENDENT PRESS AND NEWS AGENCIES
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