The energy price cap covers 28 million households in England, Wales and Scotland and is set every three months, external by the energy regulator Ofgem.
It fixes the maximum price that can be charged for each unit of energy on a standard - or default - tariff for a typical dual-fuel household which pays by direct debit.
Between 1 October and 31 December, gas prices will be capped at 6.24p per kilowatt hour (kWh), and electricity at 24.50p per kWh, external.
The rise to £1,717 per year for a dual-fuel direct debit household using a typical amount of energy is a £149 increase.
Those who pay their bills every three months by cash or cheque will pay £1,829.
The cap does not apply in Northern Ireland, which has its own energy market.
Should I take a meter reading?
Experts say it is a good idea to submit a meter reading when prices rise.
Doing so avoids being charged on estimated usage at the higher rate.
Can I fix my energy tariff?
Fixed-priced deals offer certainty for a set period but, if prices drop, people could find themselves stuck at a higher price.
Price comparison site Uswitch says the market for fixes is the best in recent years.
Some deals allow you to fix for a year, some for longer.
The forecaster Cornwall Insight, which tracks the energy market, has suggested prices could fall slightly in January by 1%. It says the typical home could pay £1,697 a year.
Prices may fall again later next year, but a prediction that far ahead is highly uncertain.
Ofgem says people should consider fixed deals as an option. However, it says they should seek independent advice and consider what is most important for them - the lowest price or the security of a fixed deal.
Uswitch warns customers to check whether fixed deals have exit fees before signing up and ensure they fully understand the terms of the contract.
Because the price cap changes every three months, it is difficult to know with any certainty whether a fixed tariff is a good deal. The longer the fixed term, the greater the uncertainty.
What is a typical household?
Your energy bill depends on the overall amount of gas and electricity you use, and how you pay for it.
The type of property you live in, how energy efficient it is, and how many people live there, all make a difference.
The Ofgem cap is based on a "typical household" using 11,500 kWh of gas and 2,700 kWh of electricity a year with a single bill for gas and electricity, which they settle by direct debit.
What is happening to prepayment customers?
Households on prepayment meters will now pay slightly less than those on direct debit, with a typical bill of £1,669, a rise of £147.
About four million households had prepayment meters in April 2024, according to Ofgem.
Many have been in place for years, but some were installed more recently after customers struggled to pay higher bills.
New rules mean suppliers must give customers more opportunity to clear their debts before switching them to a meter. They cannot be installed at all in certain households.
For the full article please visit: https://www.bbc.co.uk/news/business-58090533
Original Source: https://www.bbc.co.uk/news/business-58090533
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