Energy price increases have been set for October

Every 6 months, in April and October, OFGEM set the new price cap rates for gas and electricity. The price cap has now been set for October 2021.

OFGEM has stated:

Since we last updated the level of the cap in February, wholesale gas and electricity prices that the cap tracks have increased by over 50%, as countries have come out of lockdown.

Regrettably, this increase in costs suppliers now face will need to feed through to the new levels we set. The level of the cap will rise by £139 from £1,138 to £1,277 for a dual fuel direct debit customer with typical usage*. For customers paying by pre-payment meter, the level will rise by £153 from £1,156 to £1,309*.

This is difficult news for all households. Ofgem is calling for energy suppliers to provide all available help and support to customers who are struggling as a result of this price change.

We have strict rules in place to ensure that energy companies treat customers fairly and will take necessary enforcement action to ensure they are adhered to. We are also working collaboratively with the industry on a package of further help for those in difficulty this winter. Twenty-six suppliers, covering over 90% of domestic customers, have signed up to fresh commitments drawn up with us.

The price cap protects customers on default energy tariffs and prepayment meters who have not switched energy supplier.

Who does this price rise apply to?

This energy price increase applies to everyone on Standard energy and those who don’t switch to a cheaper online deal.

Because some consumers don’t switch to a cheaper energy deal, OFGEM have put the price cap in place so the suppliers can only charge up to the amount that has been set by OFGEM.

Avoid the price increase

Energy suppliers will increase their prices on 1st October. You can avoid these increases by switching to a cheaper tariff before they increase.