Not again!!! Gas and electricity prices have risen by 10% in England, Scotland, and Wales.

Gas and electricity prices have risen by 10% in England, Scotland, and Wales. As a result, the typical annual dual-fuel bill for households paying by direct debit has increased to £1,717. This may encourage some customers to explore switching to a fixed tariff for more price stability.

It's advised that billpayers submit a meter reading when prices change to ensure they are charged accurately for their usage.

What is the energy price cap and how is it changing?

The energy price cap, overseen by the regulator Ofgem, applies to 28 million households in England, Scotland, and Wales. It sets the maximum price suppliers can charge per unit of energy for those on a standard or default tariff, typically dual-fuel households paying by direct debit.

From October 1 to December 31, gas prices are capped at 6.24p per kilowatt hour (kWh), while electricity is capped at 24.50p per kWh. The increase in the cap has led to an annual rise of £149, bringing the typical dual-fuel bill to £1,717 per year. Those who pay their bills every three months by cash or cheque will pay £1,829.

The cap does not apply in Northern Ireland, which has its own energy market.

Should You Take a Meter Reading?

Yes, it's a smart move to submit a meter reading when energy prices rise. This helps avoid being charged based on estimated usage, which could be calculated at the higher new rate. By providing an accurate reading, you ensure you only pay for the energy you've used.

Should You Fix Your Energy Tariff?

Fixing your energy tariff can offer peace of mind by locking in a rate for a set period, but it comes with a potential downside: if prices drop, you could be stuck paying more.

According to Uswitch, the current market for fixed deals is better than it’s been in recent years. You might find deals that let you fix your rate for a year or even longer. However, energy market forecaster Cornwall Insight predicts a slight price decrease in January by about 1%, which could bring the typical annual bill down to £1,697. Further drops may happen later in the year, but predicting that far ahead is tricky and uncertain.

Ofgem advises consumers to consider fixed deals as an option but stresses the importance of seeking independent advice. Ultimately, it depends on your priorities—whether you value securing the lowest possible price or the stability of a fixed rate. Uswitch also highlights the importance of checking for exit fees before signing up for a fixed deal and fully understanding the contract terms.

Because the energy price cap is reviewed every three months, it’s hard to predict whether locking into a fixed tariff will end up being a good deal. The longer the fixed term, the greater the uncertainty.

What is a "Typical Household"?

Your energy bill depends on a variety of factors, including how much gas and electricity you use and how you pay for it. The size and energy efficiency of your home, as well as the number of occupants, all play a role.

Ofgem's price cap is based on a “typical household,” defined as one that uses 11,500 kWh of gas and 2,700 kWh of electricity annually and pays for both with a combined bill settled by direct debit. The vast majority of people pay their bill this way to help spread payments across the year.

Those who pay every three months by cash and cheque are charged more.

• Energy prices could vary at different times of day

What Are Standing Charges and How Are They Changing?

Standing charges are the fixed daily fees you pay to cover the cost of being connected to the energy supply, regardless of how much gas or electricity you use. Currently, they average around 61p per day for electricity and 32p per day for gas, though the exact amount can vary depending on where you live.

Critics argue that standing charges are unfair, especially for those who use less energy, as these fees make up a larger proportion of their overall bill. In response, Ofgem has proposed changes to standing charges and invited feedback from energy suppliers, consumer groups, and the public. This consultation closed on September 20.

Additionally, Ofgem will be adding £28 to everyone’s bill between April 2024 and March 2025 to cover the cost of £3.1 billion in debt that customers owe to energy suppliers.

What’s Happening to the Winter Fuel Payment?

Changes to the winter fuel payment mean that more than 10 million pensioners will not receive this support for their energy bills this winter.

In the past, all pensioners were eligible for this payment to help cover costs during the colder months. However, in July, the government announced that going forward, only pensioners on low incomes who receive certain benefits, such as pension credit, would qualify for the payment.

This year’s winter fuel payment—worth £200 or £300 depending on individual circumstances—will be automatically paid to eligible pensioners in November or December.

Since the policy change, around 75,000 additional people have applied for pension credit, making them eligible for the winter fuel payment.

What Other Help Is Available for Energy Bills?

If you're struggling with energy bills, several forms of support are available:

• Household Support Fund: Originally set to end in autumn 2024, the £500 million fund, designed to help vulnerable customers, has been extended by the government until March 2025. It provides targeted help for those most in need.

• Warm Home Discount Scheme: This program continues to offer discounts to eligible pensioners and low-income households, providing a reduction on energy bills during the colder months.

• Fuel Direct Scheme: Under this scheme, people with energy debt can have their repayments taken directly from their benefit payments, making it easier to manage outstanding bills.

• Affordable Payment Plans: Energy suppliers are required to offer customers affordable payment plans or, in some cases, temporary repayment holidays if they're struggling with their bills.

• Hardship Grants: Many energy suppliers also provide hardship grants to customers in financial difficulty. These can offer one-off payments to help clear energy debts or cover costs.

If you're having trouble paying your bills, it's worth exploring these options and speaking with your energy supplier for further assistance.