Households across the UK are beginning to discover how much they will need to pay for their energy this year. This is because suppliers have started to send emails and letters to customers that clearly show how much they will need to pay for their energy from April.
Energy suppliers are legally required to send notices to their customers about price increases. These notices must state in clear financial terms how much more the customer will need to pay.
Some households are being told that projections show their energy bills will rise by more than £1,000.
26 million households affected
At present, around 26 million households around the country are on variable energy tariffs or pre-payment meters that are governed by Ofgem’s price cap. In April, the level of the price cap is due to rise by almost £700 per year, to around £2,000.
However, the £2,000 a year figure is indicative of what you might pay. The actual amount that each household will pay for their energy will depend on two factors: the actual amount of energy the household uses and where the house is located geographically.
Current regulations state that energy suppliers must notify all of their customers about any upcoming price rises, and must do this a “reasonable” amount of time in advance.
The information the supplier must give the customer includes the price rise increase, what it will mean for the customer financially, and when it will take effect. The supplier cannot include any marketing information.
Messages to arrive this week
As the price rise is due to take effect next month, many suppliers are now beginning to send messages out. In fact, millions of homes across the country are due to receive them this week.
Those who use the most energy will find out that they’re set to pay much more for their energy than they do now. However, the highest level of ‘bill shock’ will be experienced by those who were previously on much cheaper fixed deals with energy suppliers that went bust last year. That is because these customers have since been moved onto variable deals with their new supplier.
At present, about 70% of energy bill payers are charged for their energy via direct debit. Due to this, payments are smoothed out across the year. This means rising bills are not delayed until the winter. Instead, new, higher direct debit demands will feed through in the coming months. Prepayment meter customers will also see an immediate impact.
Sadly, you cannot currently run an energy comparison to save money on your energy bills. This is because the best energy deals available from the UK’s best energy suppliers cannot beat the current price cap.
However, if you’re struggling with your energy bills, then you should contact your supplier immediately to see how they can help you. In addition, keep an eye out for government schemes that have also been designed to help struggling households to see if you qualify for help.
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