- What is Ofgem's energy price cap?
- How does the price cap work?
- How is the price cap calculated?
- How much is the current price cap & how often does it change?
- Who's affected by a price cap increase
What is the energy price cap?
Ofgem, the UK's energy regulator, introduced the price cap in 2019. The energy price cap limits your rates for each gas and electricity unit. However, it doesn't set your monthly bill, so your monthly bills will increase if you use more energy.
The cap is based on the costs it makes up to supply your energy. The largest of the costs that make up your bill are wholesale costs, and these costs can change the most. As a result, your bills can go up or down depending on the current energy market conditions at the time.
Who's affected by the price cap?
The price cap applies to all customers on a standard or deemed tariff.
Latest news and updates about Ofgem's price cap
25 May
Today's announcement regarding the price cap means on July 1 the overall price cap will decrease to £2,074 from £3,280 per year based on an average household(1). Read Ofgem’s press release. We'll be writing to customers in the coming weeks to update them on what today's announcement means for them.
Customers who pay via Budget Direct Debit are not required to take any action. At your next review, your Direct Debit will be adjusted to reflect any price changes, credits, or outstanding debt. We don't recommend adjusting your Direct Debit before your next payment review, as doing so might put you at risk of falling into debt.
We know things may still be difficult at the moment, but you can depend on our support. If you're struggling to pay your energy bills find advice and support in our help centre.
15 March
The government has decided to continue with the Energy Price Guarantee Scheme at £2,500 a year for a typical household(1) for at least three months. We know increasing the EPG to £3,000, even for the short-term, would have been unmanageable for many of our customers. We're preparing our new 1 April prices and will contact customers soon.
27 February
Ofgem has announced today that the price cap is changing on 1 April. Unit rates will decrease, but standing charges will increase slightly. The overall price cap will decrease to £3,280 from £4,279 per year based on an average household(1).Read Ofgem's press release
26 August 2022
Ofgem announces what the new price cap will be. Please read the full details in their press release.
4 August 2022
Ofgem announced the price cap would be reviewed four times yearly rather than twice yearly. This means the price cap is set to change next year in 2023, and reviews will happen in January, April, July and October.
What actions do I need to take?
Please don’t just cancel your Direct Debit or ignore your bill. This could cost you more long-term and harm your credit rating. If you need help, we're here. Get help and support.
We'd rather you speak to us before cancelling your Direct Debit. If you can't afford your Direct Debit payment amount, please get in touch with us to hear about the ways we can help you stay in control.
Three good reasons to remain on Direct Debit:
- Direct Debit is one of our cheapest ways to pay
- If you cancel your Direct Debit, your energy unit rates will increase too
- Direct Debit aims to spread your costs out evenly
Find out how much your energy unit rate will increase if you cancel your Direct Debit.
If you reinstate your Direct Debit within ten days, your energy unit rate will remain unchanged.
Customers who pay by Direct Debit with regular monthly payments
Customers who pay by Direct Debit with regular monthly payments you may need to take action to make sure your Direct Debit payments keep on track. Go to our help centre for advice on what to do.
Join our customers who are cutting their usage and bills
It's important now, more than ever, to stay in control of your energy. With a smart meter and our free Energy Hub, you'll easily be able to track your energy usage and see where you can save so that you can lower your bills and your carbon footprint.
Smart benefits include:
- Upgrade your meter at no extra cost
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- Get a better idea of where you use energy in your home with Energy Hub(2)
- Save up to £63 with our free Energy Hub platform(3). Smart meter required
With energy bills rising - act now to help save you money this winter!
Here are the savings insulation can save you on your bills each year:
Advice on what you can do at home to save energy
Read our tips on energy saving at home. Some of these are easy to do and completely free.
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