People who pay for their energy bills via cash or cheque have been advised to make an urgent change ahead of autumn. On Friday (August 26) regulator Ofgem will make its latest announcement about the price cap, which regulates what 24 million British households pay for their energy bills.
Ofgem confirmed earlier this month that the energy price cap will be updated four times a year, rather than twice as it warned that customers face a “very challenging winter ahead”. The regulator said the change would go “some way to provide the stability needed in the energy market."
In March, the price cap increased by 52 percent, meaning the average household would be forking out nearly £700 more on their bills annually. It is expected to rise again significantly in the autumn.
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Earlier in August, Cornwall Insight, one of the country’s most respected energy consultancies, said bills will hit a staggering £3,359 per year from October for the average household, and not fall below that level until at least the end of next year. The price cap will hit £3,616 from January and rise further to £3,729 from April, it said.
Stephen Murray, energy expert at MoneySuperMarket, said the expected increase will 'pile more pressure on already stretched household finances.' He has advised households to start preparing for autumn and winter now.
Murray explained: "If you pay for your energy by cash or cheque, call your supplier and find out how much you can save by switching to Direct Debit. Not only can it save you money, but it will help spread out your payments over a year rather than peaks in bills in the winter months.
"If you haven’t got a smart meter, get one so you can use the in-home display unit to see how much energy appliances use and real time costs. This can help spot where you can make changes that save you money.
"Most importantly, having a smart meter means your bills will be as accurate as possible. If you don’t have one, make sure you’re submitting regular meter readings. If you’re struggling to pay your energy bills, you’re not alone.
"The first step is to contact your supplier to find out what support is available. You can find information about what support is available on moneysupermarket.com."
Research by the price comparison site highlights that nearly half of Brits are either already in debt or expect to be in debt to their supplier this winter. "It's very worrying that one in six are already using payday loans to pay their energy bills. We echo the calls for more support to help people through this crisis – especially the most vulnerable," Murray added.
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