When are energy bills going up, and by how much? 1 April changes explained

The average UK household will see energy bills soar by around £500 in just two months time to £3,000 a year.

More than 80 per cent of consumer energy bills are regulated by the Ofgem price cap, which is currently £4,279 a year for homes with average use, paying a variable rate energy deal by direct debit.

However, the Government has effectively been paying for part of our energy bills since October 2022.

This is thanks to the Energy Price Guarantee, which caps how much consumers will pay per year for their gas and electricity.

At the moment, under the Energy Price Guarantee, bills are capped at £2,500 a year for an average usage household paying by direct debit.

But from April 1, two things combine that mean energy bills will rise – though exactly what you pay depends on how much energy you use and what sort of tariff you have.

Firstly, the Ofgem energy price cap will change. Analysts at Cornwall Insight predict this will fall to £3,338.07 a year for the average home.

Falling prices might seem like good news, but the level is still above the energy price guarantee, so that will define what households on default standard variable tariffs pay.

The second change is that the Energy Price Guarantee will rise, from £2,500 to £3,000 a year. 

So, the consensus is that households will still be protected by this, as it is lower than the projected price cap rate, but they will end up paying more.

If Cornwall Insight is correct – and its predictions normally come close – then that means the typical home will see energy bills rise by £500 a year from April, from £2,500 to £3,000. 

The Government will pick up the tab for around £338 of each average bill up to the price cap level.

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How much will energy bills be for the rest of this year?

According to predictions from Cornwall Insight, the average household bill will be £3,000 a year from April to the end of June, thanks to the Energy Price Guarantee.

However, after that the price cap level is forecast to fall to £2,361.96 a year from July to the end of September.

It will then rise slightly to £2,389.91 a year from October until December, the firm of energy analysts says. 

That should mean that households stop paying the £3,000 Energy Price Guarantee level and shift to the lower price cap one.

However, these predictions are exactly that, and could change. 

When will energy bills go back to normal?

Experts at Cornwall Insight say energy bills will not return to pre-2020 levels of below £1,000 per year for the average household until at least 2030.

Meanwhile, Auxilione senior partner Tony Jordan said energy bills would not fall below £3,000 a year until around July 2024.

The Government has said there will be no repeat of the current £400 per household energy bill rebate, which is paid in monthly installments and due to end in March 2023.

However, there will be additional help for people on means-tested benefits, disability benefits and the elderly this year.