Energy bills are increasing for millions of households in England, Scotland, and Wales as the new year commences, following a slight increase in Ofgem's price cap. 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 Ofgem.
The regulator's energy price cap sets the maximum price for each unit of gas and electricity for those on variable tariffs, not the total bill. This means that those who use more energy will pay more. Ofgem illustrates the cap 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.
Campaigners have expressed concern that billpayers are facing another winter of high energy prices, with this latest increase coinciding with the coldest period of the year. Kevin Peachey, cost of living correspondent, noted that changes announced in the Budget should mean a fall in the cost of energy from April.
The amount of energy used varies significantly from household to household. Factors such as the size of the home, insulation, and the number of occupants all play a role in determining energy consumption.
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