Energy consultancy firm BFY Group has predicted that the energy price cap could reach £3,420 this October and could even rise to £3,850 in January 2023. The predictions come in the same week that we see the Nord Stream 1 pipeline supply fall to 20% of its capacity and the Russian majority state-owned energy company Gazprom, blames technical issues for the fall in supply.
The energy price cap, which currently sits at £1,971, is set by the energy regulator Ofgem. The price cap is based on actual energy costs from previous months and recently switched from biannual to quarterly reviews to more accurately track the fluctuations in energy costs.
How will the energy cap predictions affect bills?
As wholesale energy costs continue to increase globally, energy customers are bracing themselves for even higher energy bills than expected and many will be hoping for a mild winter as they struggle to see how they will afford the increase.
The most recent predictions for the energy price cap increases will mean that current bills are likely to change as follows:
|Currently paying per month||From October 2022 (Based on expected increase to energy price cap)||From January 2023 (Based on expected increase to energy price cap)|
The energy consultancy firm, BFY Group say, "All time high wholesale prices for winter have pushed the forecast for the Q4 and Q1 price caps to new highs with average energy bills for January alone now forecast to be above £500."
When and how will I receive my £400 energy discount?
The £400 energy discount that was announced by the former chancellor of the exchequer, Rishi Sunak, will start being paid in instalments from October of this year - the way you will receive your discount will depend on how your household pays for energy.
How will the energy discount be applied to my energy bill?
A £66 discount will be applied to energy bills for the months of October and November followed by a £67 discount each month between December of this year through to March 2023.
|How you pay for your energy usage||How you will receive your energy discount from the government|
|Monthly or quarterly direct debit||The discount will be automatically deducted from your monthly bill|
|Monthly or quarterly card payment||The discount will be applied as a credit to your energy account|
|Smart payment meter||The discount amount will be applied to the meter as an automatic top-up|
|Standard/Old payment meter||The discount will be issued in voucher form to be cashed in at eligible energy top-up outlets such as the Post Office|
What to do if you're on a fixed or variable energy tariff
If you are on a fixed tariff, your energy supplier cannot change your energy rates except if the government increases VAT until your contract ends and with a lack of deals to switch to in the market, many are holding out on their current fixed rate energy contracts.
Citizens Advice tells consumers, "If you find a cheaper deal you don’t have to wait until your contract ends before you switch suppliers. You can switch without paying a fee if your contract ends in fewer than 7 weeks. You can switch earlier if your supplier contacts you and says you can."
Energy customers on a variable or default energy tariff will be open to changes in how much they pay for energy usage. Comparison sites for energy deals may provide offers to fix your energy rate but in the face of few deals around, there are options to get help with your energy bills if you are struggling. You will find information about grants, benefits, payment plans and debt advice in Ofgem's article, "Getting help if you can't afford your energy bills"