Energy expert Martin Lewis has announced both good and bad news for energy customers, with bills rising but the much-hated daily standing charge dropping at the same time.
Whether you’re with British Gas, EON, EDF or any other energy firm, if you’re not currently on a fix, you’ll face an increase to your bills in April equivalent to an average of £111 a year, or a 6.4% rise, Ofgem announced today.
That’s because the unit rate on electricity is rising from 24.86p per unit to 27.03p, and gas from 6.34p to 6.99p per unit, taking the average household bill on typical use to £1,849 a year.
But the daily standing charge [the cost of being connected to the energy network] is being cut by 11% for electricity, down from 60.97p to 53.8p a day, although it’s up slightly for gas, from 31.65p to 32.67p.
It means that for low users who only have electricity, they may save a little money if they can cut usage because the daily cost for having electricity has gone down.
Martin Lewis explained on X: “So for every £100 you pay for energy now, from April people will typically pay roughly £106.40.
“Yet in reality as the daily standing charge is dropping, some lower users (below £100/mth) will see only small rises, but those who use a lot (above £200/mth) will likely see 7%-10% increases.”
Martin urged anyone who isn’t currently on a fix to lock their prices down before April, as the cheapest fixes now are still lower than the price cap is now, let alone what they will be in April.
He added: “The cheapest year-long standalone fixes right now are about 4% LESS than the current cap, never mind once it rises in April, so if you get a good fix now you lock in at a cheaper rate for a year, get price certainty, save instantly and save relatively more once we get to April.
“Your cheapest fix depends on where you live and how much you use, so do a comparison (the MSE cheapenergyclub.com is whole-of-market-by default) though I’d wait a couple of hours as I hear more tariffs are being launched. Remember though the savings comparison sites will show now are compared to the current cap, they will be bigger compared to April.”
Ofgem said the increase, which will raise the average bill for households in England, Scotland and Wales on a standard variable tariff from the current £1,738 a year to £1,849, followed a recent spike in wholesale prices.
The rise will equate to £111 for an average household per year, or around £9.25 a month, over the three-month period of the price cap.
This is 9.4% or £159 higher than this time last year but £531 or 22% lower than at the height of the energy crisis at the start of 2023.
Ofgem chief executive Jonathan Brearley said: “We know that no price rise is ever welcome, and that the cost of energy remains a huge challenge for many households.
“But our reliance on international gas markets leads to volatile wholesale prices, and continues to drive up bills, which is why it’s more important than ever that we’re driving forward investment in a cleaner, homegrown system.
“Energy debts that began during the energy crisis have reached record levels and without intervention will continue to grow. This puts families under huge stress and increases costs for all customers. We’re developing plans that could give households with unmanageable debt the clean slate they need to move forward.”
