Ofgem has announced that the energy price cap will rise in January 2024. From the start of the new year, the cap will be set to £1,928 a year for the typical dual-fuel households that pay via direct debit. Overall, this means an average increase of 5 per cent per household.
Despite this, different households will be affected in different ways depending on their energy use.
The standing charge will also remain at 29p per day for gas and 53p per day for electricity.
However, the unit rate will change with gas going up by 4.6 per cent per kilowatt hour (kWh) and 7.6 per cent per kWh for electricity. Therefore, if you use more gas than electricity, you will actually see a lesser increase in your bills than someone who uses electricity more.
Ofgem chief executive Jonathan Brearley said: “This is a difficult time for many people, and any increase in bills will be worrying.
“But this rise – around the levels we saw in August – is a result of the wholesale cost of gas and electricity rising, which needs to be reflected in the price that we all pay.
“It is important that customers are supported and we have made clear to suppliers that we expect them to identify and offer help to those who are struggling with bills.
“We are also seeing the return of choice to the market, which is a positive sign and customers could benefit from shopping around, with a range of tariffs now available offering the security of a fixed rate or a more flexible deal that tracks below the price cap.
“People should weigh up all the information, seek independent advice from trusted sources and consider what is most important for them, whether that’s the lowest price or the security of a fixed deal.”
In order to help you plan out your budget for the new year, use our handy calculator below to see how much your energy bills will change.