An urgent “act now” warning has been issued to 26million households ahead of the energy bill changes in April.
The price comparison site Uswitch says households need to get get off “price-capped” tariffs before Ofgem’s price cap rises again in April. The Ofgem price cap is currently set at £1,738 a year for someone with typical energy use who pays by direct debit, however, latest predictions from EDF could see it go up by up to 6% in the spring – before rising again in July.
If this is the case, homes that stay on their supplier’s default tariff will see their bill rise around £109 on average to £1,847, with a further £35 rise to £1,872 predicted in July. This is 8% higher than today’s rates. Tariffs that follow the price cap are called standard variable rate (SVR) tariffs or variable tariffs, and you are normally on one if you have not signed up for a fixed deal or didn’t switch to a new tariff when your previous fix expired.
Wholesale energy prices have hit a 15-month high after being pushed upwards by high demand for gas and electricity during the cold winter and global instability. The official Ofgem price cap will be confirmed on Tuesday, February 25. As we are only a few weeks away from the end of the assessment period, the latest predictions are looking more concrete.
Uswitch.com is encouraging households to act quickly to lock in a deal at or below the current price cap to protect them against the anticipated increases in the price cap over the coming months. Those not wanting to fix can also now consider tariffs that track the price cap but promise to stay below it by a certain margin.
Elise Melville, energy expert at Uswitch.com, said: “If you haven’t switched energy lately, you are likely to be already paying over the odds, and the coming price hikes will only make things worse. Now is the time to take action, before the price rises hit. Any deal that is priced at, or below, the current cap level is likely to save you money over the coming year. If youʼre not ready to fix, then consider a tariff that guarantees a discount on the price cap, whether it rises or falls.”
“Standard tariffs are now the most expensive way to pay for your energy. The good news is, a better deal is out there for most homes. Right now there’s a lot of choice available and it takes just minutes to compare your options and switch to a better deal.”
A rise to Ofgem’s price cap in April would mark the third consecutive energy bill increase, after it rose to £1,717 a year in October 2024, then to £1,738 in January 2025. But despite what its name suggests, the price cap does not actually limit how much you can pay for energy. What it does is set a cap on the unit rates you can be charged for gas and electricity, as well as the standing charges. This means if you use more energy, you’ll pay more – or use less energy, and your bill will be less.
The headline price cap figure represents what the average billpayer will pay. Ofgem estimates that the average household consumes 2,700 kwh of electricity and 11,500 kWh of gas over 12 months.
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