It was announced today that the energy price cap will rise by a staggering 80% in October 2022. This means that the typical family could face an eye-watering energy bill of around £3,549 (£295.75 per month).
This time last year, the price cap (which is now reviewed quarterly) was set at £1,277 in August 2021 before rising to £1,971 in April 2022. Some experts are now predicting that bills could reach as high as £5000 by 2023.
Founder of Money Saving Expert, Martin Lewis, today warned ‘people will die’ and was scathing in his criticism of the government’s response to the increases, stating: ‘To get to the day of the announcement without having a firm package in place is devastating for vulnerable people, many of whom will already have mental health problems.’
‘The panic and desperation I am seeing across the country in my mail bag is just awful.’
Unfortunately, there are several misconceptions about the price cap, meaning some families could end up paying even more for their energy.
Why your gas and electricity bills could be even higher than the energy price cap
It is a common misconception that the energy price cap applies to consumers. In fact, there is no cap on the amount that you can pay.
It refers to standing charges and unit rates for gas and electricity, not the amount the customer is charged.
The figure of £3,549 is based on typical use, meaning that if your energy consumption is higher than average, you could end up paying more. Convexly, if you have below-average consumption levels, you may pay less.
There are many ways that you can save on your energy use.
If you want an accurate idea of what your energy prices might look like, Money Saving Expert have a tool for estimating your energy bill after the price rise cap.
They have also published the latest figures on gas and electricity unit prices:
Energy unit prices (according to Money Saving Expert)
- Unit rate: 7.37p per kWh
- Standing charge: 27.22p per day
From October 1:
- Unit rate: 14.76p per kWh
- Standing charge: 28.49p per day
- Unit rate: 28.34p per kWh
- Standing charge: 45.34p per day
From October 1:
- Unit rate: 51.89p per kWh
- Standing charge: 46.36p per day
These prices can vary by region, include VAT and are based on Direct debit customers
It’s worth noting that the energy price cap does not apply to businesses and other locations, like schools.
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