Energy bills are increasing for millions of households in England, Scotland, and Wales as the new year commences, following a slight increase in the energy price cap by Ofgem. Prices for those on variable tariffs are rising by 0.2% from now, equating to a 3 annual increase for a household using a typical amount of gas and electricity, according to Kevin Peachey, cost of living correspondent.
Campaigners stated that billpayers are facing another winter of high energy prices, with the latest increase coinciding with the coldest period of the year. However, changes announced in the Budget are expected to result in a fall in the cost of energy from April.
Ofgem's energy price cap sets the maximum price for each unit of gas and electricity for those on variable tariffs, not the total bill. Therefore, consumers who use more energy will pay more. The regulator's cap is illustrated with a household using a "typical" amount of 11,500 kWh of gas and 2,700 kWh of electricity a year with a single bill for gas and electricity, settled by direct debit. This household would see a 3 rise in its annual bill from 1,755 to 1,758. However, the amount used varies significantly.
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