Energy bills to rise for 11 million – act now to beat the hikes

The hike is down to Ofgem raising the price cap on standard and default tariffs from £1,042/yr for a typical user, to £1,138/yr. These tariffs are typically the most expensive ones – and if you’ve not switched in the last year, it’s likely you’re on one.

For the average household, the hike means bills are set to rise by £96/yr from Thursday 1 April – with many suppliers likely to price their standard and default tariffs within just a few pounds of the new level.

However, the new cap level isn’t the maximum anyone will pay. The price cap sets a limit on the rates you pay for each unit of gas and electricity, so if you use more, you’ll pay more.

Compared to the new price cap, the current cheapest energy deal is on average £213/yr less than the new cap on typical use, including £25 Cheap Energy Club cashback. So don’t get caught out – do a Cheap Energy Club comparison and lock in a cheap fix.

If you have switched recently, it’s likely this won’t affect you, as prices are only capped on expensive standard variable tariffs that you’re automatically rolled on to when a fixed deal ends, or you move home.

Ofgem has also announced a £87/yr increase to the cap from Thursday 1 April for four million households on prepay tariffs – from £1,070/yr to £1,156/yr for a typical household.

See how much more you could save on your energy bills by doing a quick full-market comparison via our free Cheap Energy Club. And if you need help choosing, try our Pick Me A Tariff tools.

‘Hopefully it will shock some people into action’

Martin Lewis, founder of, said: “Many will be shocked by the price cap rising £96/yr on a typical bill – the silver lining is it will hopefully shock some people into action.

“The cap may be a ‘fair’ price, but it is far from a good one, over the last few years it has largely been at least £200 more than the cheapest tariffs for switchers, on average. This current rise is really reverting it back to form, it was only artificially low this time on the back of the huge reduction in world energy prices due to the early days of the pandemic.

“Yet there’s an important warning for the 10,000s who will flood towards comparison sites right now. These sites (including ours at MoneySavingExpert) will not show the right saving. The saving shown will be listed compared to the current price cap level, as if you’d stick on that for a year. It won’t include the big jump due to come, lasting at least six months, from April. That can only usually be factored in once energy firms publish their new detailed rates for each region – which is likely weeks away.

“So while I’d strongly urge everyone on a standard tariff to compare and find their cheapest supplier – don’t be put off by the relatively small saving shown. In reality it is likely to be much bigger.”

How does the price cap work? 

The price cap sets a limit on the maximum amount suppliers can charge for each unit of gas and electricity you use, and sets a maximum daily standing charge (what you pay to have your home connected to the grid).

Currently, someone who uses a typical amount of energy on a standard or default tariff pays a maximum of £1,042/yr on average, but that is set to rise to £1,138/yr from Thursday 1 April.

As the cap limits the price providers can charge for each unit of gas and electricity, if you use more energy, you’ll pay more; use less and you’ll pay less.

The price cap is reviewed twice a year, with changes coming into effect in April and October. It’s set to remain in place at least until the end of this year, with Ofgem to recommend later this year it should continue into 2023.

You could save a massive £200+/yr by switching

Compared to the new price cap, switching to the cheapest on the market right would save on average £213/yr, based on typical use, including Cheap Energy Club cashback. And if you’re on one of these capped tariffs, you can’t be charged exit fees, so you’re free to switch away at any time.

You can use our Cheap Energy Club to compare the whole of the market or use our popular Pick Me A Tariff tools, where you tell us you preferences and we find your top pick tariff. 

As we don’t yet know how suppliers will change their prices under the new level of the cap, the savings you see when you compare will be underestimated as they are based on the current cap. But don’t let that put you off – you’ll save much more than any energy comparison site shows at the moment (including ours).

Struggling to pay your bill? There’s lots of additional help available right now 

Due to the coronavirus pandemic, Ofgem has strengthened protections for energy customers, and put in place new rules to help those struggling to pay their bills.

Most importantly, your supply won’t be cut off – disconnections of standard credit meters have been completely suspended, while new rules have been put in place to ensure prepayment customers get emergency or additional credit to ensure the lights stay on. 

For more info see energy coronavirus help, or check Ofgem’s website for what to do if you’re having difficulty paying. 

What does Ofgem say?

Ofgem chief executive Jonathan Brearley said: “Energy bill increases are never welcome, especially as many households are struggling with the impact of the pandemic. We have carefully scrutinised these changes to ensure that customers only pay a fair price for their energy.  

“The price cap offers a safety net against poor pricing practices, saving customers up to £100 a year, but if they want to avoid the increase in April they should shop around for a cheaper deal.  

“As the UK still faces challenges around COVID-19, during this exceptional time I expect suppliers to set their prices competitively, treat all customers fairly and ensure that any household in financial distress is given access to the support they need. 

“The government and Ofgem have been working with the energy industry and consumer groups to support customers through this difficult time and I urge anyone worried about paying their energy bills to contact their supplier and access the help available.”

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