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Evening Standard
Evening Standard
National
Josie Clarke and Michael Howie

Household energy bills to rise again in January as cold weather grips UK

Ofgem has confirmed household energy bills are to rise again from January 1 as it announced a 1.2% increase to its price cap.

The regulator said the increase would see the typical bill for a household in England, Scotland and Wales increasing from £1,717 to £1,738-a-year, or around £1.75-a-month.

It follows the price rising by 10% in October.

The latest rise will be a blow to millions of hard-pressed households facing hard choices about whether to put the heating on as a cold snap continues.

Temperatures in London plunged below zero on Thursday night as a series of Met Office weather warnings blanketed the UK ahead of the arrival of Storm Bert at the weekend.

Tim Jarvis, director general of markets at Ofgem, said: "While today's change means the cap has remained relatively stable, we understand that the cost of energy remains a challenge for too many households. However, with more tariffs coming into the market, there are ways for customers to bring their bill down so please shop around and look at all the options.

Weather warnings are covering almost the whole of the UK (Met Office)

"Our reliance on volatile international markets - which are affected by factors such as events in Russia and the Middle East - means the cost of energy will continue to fluctuate. So it's more important than ever to stay focused on building a renewable, home-grown energy system to bring costs down and give households stability.

"In the short-term though, anyone struggling with bills should speak to their supplier to make sure they're getting the help they need and look around to make sure they're on the best, most affordable deal for them."

Ofgem urged customers to take advantage of increasing choice among suppliers and look for the best deal to help keep their bills down, saying households could save up to £140.

The latest price cap is 10% or £190 lower than a year earlier, and 57.2% or £2,321 less than during the energy crisis, which was fuelled by Russia's invasion of Ukraine in February 2022.

But it comes as millions of pensioners are facing a winter with less support, after the new Government decided to scrap winter fuel payments for those who do not receive pension credit or other benefits.

About 10 million pensioners will miss out on the payments of up to £300 this year.

Overnight snow covers Cullercoats Bay in North Tyneside (Owen Humphreys/PA Wire)

National Energy Action chief executive Adam Scorer said: "Today's news that the price cap is rising by 1.2% will impact millions of vulnerable households. Bills are around 50% higher than pre-crisis levels.

"With temperatures now plunging and far less support available many are getting deeper into debt trying to keep warm. Now we know there will be no let up into January and beyond. Targeted government support is essential to save millions from the misery and danger of a cold home.'

Ofgem changes the price cap for households every three months, largely based on the cost of energy on wholesale markets, with the regulator confirming the level for the first quarter of next year on November 22.

The energy price cap was introduced by the Government in January 2019 and sets a maximum price that energy suppliers can charge consumers in England, Scotland and Wales for each kilowatt hour (kWh) of energy they use.

It does not limit total bills, because householders still pay for the amount of energy they consume.

Ofgem is also currently considering the future of price protection, including the suitability of the price cap and a potential permanent ban on so-called acquisition tariffs - cheaper prices for new customers to lure them away from their existing supplier.

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