Almost 10 million households across the UK have been given a final warning that they could end up paying more for their energy bills if they fail to provide meter readings to their suppliers. This comes as a 10% price hike comes into effect, with the average annual energy bill set to increase by £149 starting from Tuesday. The energy regulator Ofgem has raised the price cap from £1,568 to £1,717 for a typical dual fuel household in England, Scotland, and Wales, resulting in an additional £12 per month on average bills.
Households on standard variable tariffs (SVT) without smart meters are urged to submit their electricity and gas readings promptly to avoid being inaccurately billed at higher prices for the energy used before October 1. Failure to provide meter readings means that suppliers base their bills on estimated usage, potentially leading to households either overpaying or underpaying for their energy consumption.
The price cap determines the maximum price energy suppliers can charge consumers per kilowatt-hour of energy used, but it does not cap the total bills as they are based on the actual energy consumption. From October 1, households on SVTs paying for electricity by direct debit will face an average charge of 24.5p per unit with a daily standing charge of 60.99p, while for gas, the average unit charge will be 6.24p with a standing charge of 31.66p per day.
The price hike has been attributed to increased prices in the international energy market due to political tensions and extreme weather events. Furthermore, millions of pensioners are set to receive reduced support this winter as the government has decided to halt winter fuel payments for those not receiving pension credits or other benefits, affecting around 10 million pensioners who will miss out on payments of up to £300 this year.
A survey by the National Energy Action (NEA) and YouGov revealed that 46% of British adults are likely to ration their energy use this winter to cope with rising costs. NEA chief executive Adam Scorer expressed concerns about households facing difficult decisions between accumulating energy debt or sacrificing heating comfort. However, there is a glimmer of hope as experts predict a 1% decrease in the price cap in January, with further reductions anticipated in the following quarters.
Consumers are advised to explore fixed-rate tariffs that could potentially save them money. Ofgem’s chief executive highlighted the importance of shopping around to find the best deals and stated that the regulator is collaborating with various entities to provide support to customers. Citizens Advice has highlighted particular concerns about households with children, young people, and those on lower incomes who may struggle with heating costs during the winter months.
To avoid the impact of the price hike, households are encouraged to consider fixed tariffs that offer lower rates than the revised price cap. By locking in lower rates before winter begins, consumers can potentially manage their energy costs more effectively amidst the ongoing uncertainties in energy prices.
In conclusion, the current energy price rise presents a challenging situation for many households, necessitating proactive measures such as providing accurate meter readings, exploring alternative tariff options, and seeking support from available resources to navigate through the increasing energy costs during the winter period.