Is there a new Energy Price Cap?
No, the energy price guarantee will now remain fixed at £2,500 for at least 3 months.
Confirmation came today from Chancellor Jeremy Hunt that the energy price guarantee will not be increasing by 20% as originally planned. Instead, the EPG will remain at £2,500 annually for the average UK family.
Support was also announced for households with pre-payment meters, who from July ‘won’t pay more than those on Direct Debits‘. This comes as good news to the 4 million UK households with pre-pay meters installed. Despite being more likely to be lower-income households, these customers currently pay a premium to cover the management of their meters.
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Why has the government changed their plan?
The decision to keep the EPG at its current level comes after months of dedicated campaigning from consumer advocate groups, including Money Saving Expert’s Martin Lewis.
The price rise was criticised almost immediately for the impact it would have on struggling households. The 20% hike would have seen the average household paying £3,000 a year or £250 a month for gas and electricity.
Faced with the existing 6.7 million UK households in fuel poverty and the prediction that an EPG will leave a further 1.7 million households struggling to meet basic needs, the decision to fix the EPG is a welcomed one.
When will the Energy Price Guarantee change?
The new plan, as outlined in Hunt’s budget, is for the expected 20% price increase to occur in three months’ time at the end of June 2023. Wholesale electricity and gas prices are expected to fall around this time, so we may see fixed-rate tariffs priced below the EPG available before this date.
Analysts have also predicted Ofgem’s Price Cap – another price control method that was superseded by the Energy Price Guarantee – will fall to just above £2,100 from July 1st. With both market caps in place, consumer prices will be capped at the lower value.
Will my energy bills change in April?
With the EPG remaining the same, most people won’t see a change in their initial energy bills from April. April also marks the end of the monthly energy support payments made to UK households this winter.
The last £67 payment was made in March, so if these were previously applied to your bills automatically you’ll see an increase by this amount. We don’t yet know if there’ll be a £400 energy support payment or a similar scheme this winter.
How will my other bills change in April?
Many contracts and tariffs are renewed and updated in April at the start of the new tax year. You should already have been contacted by your Council, water supplier and broadband provider if there’s going to be an increase to your bills from April.
Read more about utility bills in 2023:
Water
The average UK water bill will increase by 7.5% in April. The amount bills will change varies from supplier to supplier, below you can see the percentage change for every combined water and sewerage supplier in the UK.
|
Water supplier |
Average 2023/24 bill |
Average 2022/23 bill |
Change |
|
Anglian |
£492 |
£445 |
9.6% |
|
Dŵr Cymru (Welsh Water) |
£498 |
£485 |
2.6% |
|
Hafren Dyfrdwy |
£372 |
£331 |
11% |
|
Northumbrian |
£391 |
£363 |
7.1% |
|
Severn Trent |
£419 |
£392 |
6.4% |
|
South West |
£526 |
£518 |
1.5% |
|
Southern |
£439 |
£396 |
9.8% |
|
Thames |
£456 |
£417 |
8.6% |
|
United Utilities |
£443 |
£417 |
5.9% |
|
Wessex |
£504 |
£462 |
8.3% |
|
Yorkshire |
£446 |
£416 |
6.7% |
TV
One bill that won’t be changing is the TV licence fee. This will remain fixed at its current price of £159 until April 2024.
Broadband
Ofcom, the UK regulator for the communications industry, has launched an investigation into mid-contract price rises for broadband. The inquiry comes after BT, Virgin Media and other major providers announced price rises of up to 17.3% this spring, ahead of UK inflation.
Your supplier should have already contacted you directly with the details of if and how your bill will change. You can check below to see if customers of the UK’s biggest providers will be seeing rising broadband prices.
Broadband price rise 2023
|
Provider |
How much will prices rise by |
Effective date |
|
BT |
up to 14.4% |
31 Mar 23 |
|
EE |
up to 14.4% |
31 Mar 23 |
|
Now |
TBC |
|
|
O2 |
up to 17.3% |
1 Apr 23 |
|
Plusnet |
up to 14.4% |
31 Mar 23 |
|
Shell |
up to 13.5% |
1 Apr 23 |
|
Sky |
up to 9% |
1 Apr 23 |
|
TalkTalk |
up to 14.2% |
1 Apr 23 |
|
Three |
up to 14.4% |
1 Apr 23 |
|
Virgin Media |
up to 17.3% |
1 Apr 23 |
|
Vodafone |
up to 14.4% |
1 Apr 23 |
Can I leave my contract without penalty?
If you are outside your initial contract period, you can leave your current contract without penalty. If you’re happy with your current service other than the price increase, let your supplier know this when you go to cancel. Most internet providers have a lot of flexibility on pricing when it comes to keeping customers on board, so see what discount you are offered to stay. Make sure to have the welcome prices from some competitors to hand, and read our guide on complaining to your broadband provider for more details.
If you are still within your initial commitment period, read the terms of your contract carefully. Most will mention that the supplier has the right to raise your prices, but if it’s not mentioned – as is the case for millions of Virgin Media and Sky customers this year – then you can leave your contract penalty-free. Customers only have 30 days from the date they are notified about the price increase to exit without penalty, so reach out to your supplier immediately if you are affected
Otherwise, your options are to accept the price hike or pay an exit fee to leave your contract early. These are usually around 60% of the remaining value of your contract, so unless you’re very unhappy about the price rise you’ll be better off waiting till the end of your contract.
Read more about energy in the UK:
