Energy bills will rise in January, Ofgem confirms

Ofgem has announced that the energy price cap will rise in the new year, meaning consumers will be charged more per unit of gas and electricity.

From January 1 to March, Ofgem will up the cap from £1,834 to £1,928, reflecting what the average household would pay over a year on the higher rates.

Per kilowatt hour of electricity and gas, consumers will be charged 29.60p and 7.42p respectively, compared to 27.35p and 6.89p currently.

Daily standing charges, which consumers pay regardless of usage, will remain broadly the same at 53.35p for electricity and 29.60p for gas.

“The increase in the price cap is because the cost of wholesale gas has gone up in recent months,” Ofgem said in a statement

“This is due to world events including the conflict in the Middle East.”

Ofgem’s cap had been introduced in 2019 to place a maximum on what suppliers could charge households, but has since become an effective default for energy prices.

The higher cap is therefore set to see bills increase across the board from January for the majority of UK households, which are on standard variable – or default – tariffs.

Calls have come in for the government to offer support for households as a result, after the price guarantee was lifted to £3,000 earlier this year and became obsolete as a result.

This had ensured the government would subsidise bills over a certain point, with other cash support having been offered but since scrapped.

“With prices likely to stay around this level for the foreseeable future, we need to press ahead with measures to keep bills down over the long-term,” industry body Energy UK said.

“That means the government getting on with their pledge to look at introducing consistent bill support through, for example, a social tariff and by making more of our homes energy efficient.”