12 October: Bills Would Rise £1.50 A Month For Q2 2024
Households may face a one-off rise in their energy bills of up to £17 a year to prevent suppliers from going bust, writes Candiece Cyrus.
Regulator Ofgem has proposed the move as part of a consultation on ways to protect suppliers from going bust because of customer debt, which reached £2.6 billion this summer, its highest recorded level.
In 2021, around 30 suppliers folded when they were unable to pass rising wholesale costs on to customers quickly enough. The cost of administering the transfer of their customers to other firms and maintaining energy supplies added £82 to every household’s energy bills.
The crisis also prompted Ofgem to move to quarterly rather than six-monthly adjustments to the cap, making it more responsive to wholesale price movements.
The temporary rise would be applied with next April’s price cap and last for three months, adding around £1.50 to the average household’s bills per month (equivalent to £17 a year). The cap dictates the maximum amount suppliers can charge households per unit of energy, and in standing charges.