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

When are YOUR energy bills going up – and by how much? Support will be cut in April but market prices are falling, here’s what it means for what you pay

  • Household energy bills are set to rise by £500 a year from April 1
  • The average home will soon pay £3,000 a year for their gas and electricity
  • The good news is that energy bills will start to fall from July – but not by much 

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.

Energy bills will rise for most households in April, before falling during the rest of 2023

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.

>> Water bills set to rise by up to 12.9% a YEAR adding extra pressure to households during cost of living crisis 

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. 

What the average home will pay for energy this year 
April to June  July to September  October to December 
£3,000 £2,361.96 £2,389.31 
Source: Cornwall Insight/Government figures 

SIMON LAMBERT: Hunt should reverse his energy price hike 

One of the stranger moves made by Jeremy Hunt, when he took over as Chancellor and ripped up Liz Truss and Kwasi Kwarteng’s plans, was to first threaten to remove the Energy Price Guarantee early and then raise its level by £500.

This added an extra degree of financial uncertainty for households already reeling from high inflation, a massive jump in energy bills, and big mortgage rate hikes at the end of fixed deals.

Although Liz Truss’s Energy Price Guarantee was controversial and far from perfect, the pledge that a £2,500 cap would be in place for two years provided certainty that bills wouldn’t spiral beyond this.

Initially, Hunt said that the guarantee would end far earlier than that and only last until April 2023, before announcing in his Autumn Statement that it would continue for a year after that and be set at £3,000 until April 2024.

That came against a backdrop of high energy prices making the guarantee look enormously expensive and Hunt taking the axe to everything he could to try to calm febrile markets that had reacted badly to Truss and Kwarteng’s debt-funded tax cutting spree.

But at the sharp end of household budgets, what the Energy Price Guarantee’s rise in April means is another 20 per cent jump in bills that people are already struggling with.

Even with the lower £2,500 cap in place, people are paying more than twice what they were a year ago for gas and electricity. Many can little afford another 20 per cent rise. 

This will push more into fuel poverty and cause financial pain for others who are better off but still struggling to make ends meet each month.

Wholesale energy prices and forecasts have fallen since Hunt made his decision to hike the Energy Price Guarantee, helped by lower use in Europe’s milder than expected winter.

The Chancellor should revisit his decision and stall the Energy Price Guarantee rise to £3,000, sticking at £2,500.

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.

What energy support is on offer? 

 As prices rise energy companies are increasing their support for customers, includindditional funding for customers in fuel poverty. 

Suppliers in the UK provide discretionary support of around £54 million on top of the more than £1 billion in mandatory schemes they deliver every year, according to Energy UK. 

This includes the Energy Company Obligation and Warm Homes Discount. 

Suppliers have already implemented payment holidays, payment plans and credit advances to customers on pre-payment meters. 

Other measures include:  

  • Eligible British Gas customers are being offered grants of between £250 and £750 
  • EDF Energy is contacting 100,000 vulnerable customers to provide them with tailored help and access to apps like Energy Hub, which can help them reduce their bills by an extra £100 
  • Octopus created a £5million financial hardship fund at the beginning of the energy crisis dedicated to helping customers who are unable to afford the cost of living 
  • Utilita is introducing a hardship fund to help customers write off debt 


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