The price cap does not set a limit on what you pay for energy — instead, it puts a cap on how much you pay for unit rates of gas and electricity, plus standing charges
Energy bills are expected to drop slightly in January — but experts warn they could then rise again in spring.
Analysts at Cornwall Insight are predicting the Ofgem energy price cap will fall from £1,755 a year for the typical household paying by direct debit, to £1,733 — a decrease of £22.
Ofgem will announce its January price cap this Friday. The expected fall is down to a slight drop in wholesale energy prices. However, Cornwall Insight then expect the price cap could rise by around £75 a year in April.
Craig Lowrey, principal consultant at Cornwall Insight, said: “January’s price cap dip might look like good news but it’s only part of the picture.
“Bills are still well above pre-crisis levels and are set to climb again in April, and this time it’s not higher wholesale prices driving the rise.”
It said the expected April rise is “largely due to rising charges associated with the operation and maintenance of the country’s energy networks, specifically electricity transmission and gas distribution charges”.
Mr Lowrey added: “The shift to renewables will bring long-term stability and energy independence, but it’s not free.
“The upfront costs are real, and they’re landing on bills now. The challenge will be balancing short-term affordability with long-term resilience, and crucially making sure people understand why that trade-off matters.”
The price cap does not set a limit on what you pay for energy — instead, it puts a cap on how much you pay for unit rates of gas and electricity, plus standing charges.
Standing charges are fees you pay to be connected to the grid. Almost two million households were recently urged by Ofgem to check if they can claim back £240million in forgotten energy credit.
The energy regulator revealed 1.9 million closed energy accounts still have money sitting in them. This includes households that have moved home in the last five years, where their old energy supplier has not been able to get in contact with them.
Ofgem estimates some people could claim back more than £100, while others may only be due back a few pounds. Energy suppliers are required to issue a final bill within six weeks of an account being closed and refund within ten working days.
More than 90% of closed account balances are returned automatically. If you believe you could be owed money, you should check letters and emails for final bills, and contact your old supplier.