Increase in energy prices: what you need to know
Why are energy prices rising?
Energy prices are rising due to various factors including an increase in wholesale global energy prices. Ofgem, the Government regulator for electricity and gas, has announced an energy price cap rise of 54%, an extremely concerning amount for most households in the UK. Global gas prices have increased by a record amount in the last six months and wholesale prices have quadrupled in the last year.
When will energy prices go down?
The rise in energy prices is predicted to continue for the next two years with the next price cap increase expected in October.
What does the change in energy prices mean for me?
The average customer energy bill will rise by an eye-watering £700 per year. You will see an increase in your bills if you aren’t on a fixed tariff or have recently switched to a new supplier after your old supplier closed.
How can I get help with energy prices?
How can I get help with energy prices? A package of support measures for Great Britain has been announced by the Chancellor of the Exchequer that includes a £150 Council Tax discount for those in bands A-D in England and a £200 rebate on energy bills per household in October to be paid back over the next five years.
In Scotland, the Cabinet Secretary for Finance and Economy has announced support that includes £150 to go to anyone receiving Council Tax reduction across any Council Tax band alongside £150 for all other occupied households in Council Tax bands A-D. There will also be support available through the Fuel Insecurity Fund to prevent self-disconnection or self-rationing.
Last month the Northern Irish Government announced an Energy Payment Support Scheme, designed to target support to those most in need of help by way of a £200 direct grant to people in receipt of certain benefits.
Wales are expected to announce their support measures soon.
Where can I go for advice about my energy bills?
If you're concerned about the increase in energy prices, the following organisations can provide advice and support:
If you are struggling to pay your bills, you can contact your supplier directly to see if they can help.
I’m in debt and won’t be able to afford the increase in my bills, who can help?
If you are struggling with debt and have concerns about your gas and electricity bills rising, we can offer you advice as part of our free debt help service. We will also help you access any support you are entitled to, and assist with budgeting.
Get in touch to start your journey out of debt today by calling 0800 328 0006.
What is CAP’s response?
We’re pleased to see the Government taking action to help with the increase in energy bills, however, we’re concerned the measures don’t go far enough. The £200 discount due in October will be too late for many and the measures announced won’t help households meet the higher costs expected to last for at least two years. Those living in low-income households experiencing fuel poverty will be the worst affected.
We’re calling for further action including:
- The uprating of benefits in April to reflect the forecasted inflation rate of 7.25%, instead of the planned 3.1%.
- The Warm Home Discount scheme also needs to be increased from the planned £10 rise in Winter 2022/23. Many more people will need much more support than this.
Last updated: 10 February 2022