You may have seen the news that energy bills are expected to rise for up to 15 million households this winter. We’re here to provide some support on this.
What is happening?
There is something called a price cap for standard variable tariffs (sometimes called a default tariff) and prepayment tariffs, which limit the rates a supplier can charge for these tariffs. This cap can be raised if there’s a rise in wholesale costs, which is what is happening here. It will rise by £139 for customers on default tariffs paying by direct debit and by £153 for pre-payment customers from 1st October 2021 and will affect an estimated 15 million UK households.
Why is this happening?
The rise is due to a 50% rise in wholesale energy costs, i.e. the amount suppliers have to pay to buy the energy. There’s also a rise in the wholesale cost of petrol and diesel too.
How will this affect you?
- If you are on a fixed rate tariff it should not affect you until the end of your current contract
- If you are on a standard variable tariff or on a pre-payment meter you could see an increase in your energy bill, even if you’re only using the same amount of energy as you always have.
- How do you check what type of tariff you are on? It should say on your bill or online account. If it’s fixed rate it often says 1yr or 2yr. Check to see if the price cap will affect you here.
What help is available?
1) Check if you can apply for the warm home discount. This could save you £140 off your winter 2021 – 2022 energy bill. The scheme is not officially due to open until 18 October 2021. However some suppliers have opened applications early. As it’s a first come first served scheme we urge you not to miss out. Applications are due to open soon or are already open with:
2) Check if you could be saving money by switching energy tariffs
Thanks for reading,
Switched On Team