Energy prices will rise by 6.4% in April under regulator Ofgem’s new cap – a higher-than-expected increase adding pressure on people’s finances in UK.
It means a household using a typical amount of gas and electricity, will see their annual bill rise by £111 a year, or £9.25 a month, taking the total bill to £1,849 a year.
The cap, which puts a limit on the amount suppliers, can charge for each unit of energy, affects the bills of 26 million homes in England, Wales, and Scotland.
Rising wholesale costs, are behind the latest price hike. The third consecutive increase in the quarterly cap.
Analysts had forecast a 5% rise in prices, before Ofgem’s announcement on Tuesday.
As well as wholesale costs, the regulator said, inflation was behind the latest increase.
While the cost of each unit of gas and electricity is capped. The total bill is not, so household bills will vary, depending on how much energy is used.
The regulator illustrates the cap, by showing the impact on the annual bill of a household with typical energy usage.
Bills are about 50% higher than pre-Covid levels. But remain below the peak reached in 2022 when Russia’s full-scale invasion of Ukraine caused energy prices to spike.
