ENERGY bills will rise for millions of households this spring.
The energy regulator Ofgem has confirmed the new price cap, which comes into effect on April 1, 2025.
The average dual fuel bill for those not on a fixed deal will rise from its current rate of £1,738 a year to £1,849.
It marks the third consecutive quarter that bills have risen for around 28million households on standard variable tariffs (SVTs).
The rise is because of an increase in gas prices across Europe, caused by a slump in the amount of gas that is held in storage across the continent.
While the price cap is likely to go up, in practice, most people will pay less to their energy suppliers in the spring and summer months.
That is because households typically use less energy then, but the rate they are paying per unit will still rise.
It comes after forecasting group Cornwall Insights said last week it expects the typical annual household energy bill to rise by about £85 to £1,823.
Despite the rise, average bills remain considerably lower than during the peak of the energy crisis, which was fuelled by Russia‘s invasion of Ukraine in February 2022.
The war caused a spike in an already turbulent wholesale energy market, driving up costs for suppliers and customers.
Before the energy price shock, a standard annual bill was £1,084.
The next price cap for July 1 until September 30 will be announced in May.
It’s adjusted every three months to reflect rises and falls in wholesale costs.
If you’re on a fixed tariff there will be no change to your bill, as you’ve locked in the price for a set period.
It’s worth remembering that the cap reflects the typical dual fuel bill, and it’s the unit price that is capped.
That means bills can be higher or lower depending on usage.
Ofgem is also currently considering the future of price protection, including the suitability of the price cap and a potential permanent ban on acquisition-only energy tariffs, or (BAT).
The BAT, was introduced in April 2022 to eliminate the often risky short-term discounted tariffs designed to entice customers to switch suppliers.
It comes after millions of pensioners are also still recovering from 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.
Meanwhile, the Household Support Fund will end on March 31.
The grants, which are handed out by local councils, gives hard-pressed families cash and vouchers to help with food and electricity costs.
Inflation also unexpectedly climbed to its highest level recorded in 10 months in January, reaching 3%.
Inflation is a measure of how the price of goods and services is rising or falling, which can affect people’s household finances.
How to get help with your energy bills
If you are worried about paying your energy bills this winter it is worth being aware of a number of support measures which are available.
For starters, the government has begun rolling out its Cold Weather Payment, which gives people £25 for every seven day period of cold weather.
Many gas and energy suppliers offer grants and schemes for customers who are struggling.
For example, British Gas has a fund open to pre-payment meter and credit customers who have found themselves in debt worth up to £1,700.
The Individual and Families Fund was first set up in 2021 to help households struggling with energy debt.
This scheme’s support is available to British Gas and non-British Gas customers.
What energy bill help is available?
There's a number of different ways to get help paying your energy bills if you're struggling to get by.
If you fall into debt, you can always approach your supplier to see if they can put you on a repayment plan before putting you on a prepayment meter.
This involves paying off what you owe in instalments over a set period.
If your supplier offers you a repayment plan you don’t think you can afford, speak to them again to see if you can negotiate a better deal.
Several energy firms have schemes available to customers struggling to cover their bills.
But eligibility criteria vary depending on the supplier and the amount you can get depends on your financial circumstances.
For example, British Gas or Scottish Gas customers struggling to pay their energy bills can get grants worth up to £2,000.
British Gas also offers help via its British Gas Energy Trust and Individuals Family Fund.
You don’t need to be a British Gas customer to apply for the second fund.
EDF, E.ON, Octopus Energy and Scottish Power all offer grants to struggling customers too.
Thousands of vulnerable households are missing out on extra help and protections by not signing up to the Priority Services Register (PSR).
The service helps support vulnerable households, such as those who are elderly or ill.
Some of the perks include being given advance warning of blackouts, free gas safety checks and extra support if you’re struggling.
Get in touch with your energy firm to see if you can apply.