Today (26 August), Ofgem has announced the new energy price cap, which will take effect from 1 October 2022.
The price cap will increase to £3,549 a year for dual fuel for an average household paying by direct debit. This is an 80% rise from the current cap of £1,971 per year. For customers on pre-payment meters, the increase is from £2,107 to £3,608. This cap will remain in place until it is adjusted again in January 2023.
Today’s news of a further increase to the price cap on energy bills will be very concerning for people across Great Britain. With predictions that the cap could increase again next year, it has never been more important for the UK Government to help shield households from the impacts of these rising energy costs – crucially both in the short and long term.
Mike Thornton, chief executive of Energy Saving Trust, said: “Households across the UK face a dire winter – and the UK Government’s response needs to match the scale of the emergency. While rapid action to support the most vulnerable is critical, we also need robust measures to ensure this does not happen again. Forecasts suggest that price hikes may continue beyond 2023, so as well as shorter-term help with bills, this long-term problem requires long-term solutions that deal with the underlying issues.
“Improving the energy efficiency of the UK’s inefficient homes through a mass retrofit programme is the most effective way to permanently get bills under control, reduce our reliance on a volatile global fossil fuel market and cut carbon.
“Reducing energy demand reduces energy bills, regardless of the volatility of energy markets. Combined, energy efficiency improvements in heating, insulation, lighting and appliances could reduce energy consumption in UK households by a quarter each year. Latest estimates from the ECIU show that better insulated homes could save well over £1,000 a year on bills at the latest price cap level for October.
“Alongside this, we also need to ramp up investment in renewables and energy storage – including low carbon heating and solar. Tackling the energy crisis is inextricably linked to addressing the climate emergency and the UK’s over-reliance on the global fossil gas market, emphasising the urgency to transition to net zero.
“Every day of inaction increases the cost of the challenge: we cannot afford to wait for the next Prime Minister to be decided. We need government to show leadership and step up now to provide both the immediate and longer-term responses to this crisis that are so desperately needed, including scaling up energy efficiency programmes.”
If you’re struggling to pay your energy bills, there is help available wherever you are in the UK. Find more information, including support near you. For those looking for ways to reduce how much energy you use at home – and save money on your bills – our quick tips could help.
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