MILLIONS will see their energy bill rise by £149 as Ofgem’s new price cap comes into force today, Tuesday, October 1.
Households previously paid £1,568 a year but the figure is now set to rise by nearly £150 to £1,717.
Around 29million customers on their energy providers’ standard variable tariff (SVT) are expected to see their bills rise.
Ofgem updates its price cap every three months, setting a ceiling on how much suppliers can charge for each unit of gas or electricity.
It was created five years ago to protect customers from being overcharged by suppliers.
But it is worth bearing in mind that the £1,717 figure is just an estimation given by the energy regulator.
It is calculated assuming that a typical household uses 2,700 kWh of electricity and 11,500 kWh of gas over a 12-month period.
Those who use less electricity will pay less, while those who use more will have to pay more.
The exact amount you pay is based on a number of factors, including where you live, your supplier and how you pay for your gas and electricity.
There are 14 different “Distribution Network Operators” across Britain, who can dictate your energy costs.
For example, those in Northern Scotland will see their bills rise to £1724.47 up from £1577.66 starting today.
While households in North West of England will see their bills increase to £1,689 up from £1,533.
Those in the South West will pay the most, with the average annual bill costing £100 more at £1,766 a year.
These varying prices occur because generating gas or energy is cheaper in some areas than others.
Your regional standing charge, which is how much you pay to stay connected to the grid, also varies depending on where you live.
For example, those living in the northern region (North East England) pay the highest standing charge in the country.
A typical household here will now be charged £379 as of today.
While prices are expected to be high for the next three months, experts are predicting a fall come January.
Cornwall Insight has published a new forecast predicting a £20 drop in the new year to £1,697.
Dr Craig Lowrey, principal consultant at Cornwall Insight said October’s rise is a “temporary blip”.
He said: “Typically some of the coldest months of the year, often bring with them the biggest energy bills, and – while our latest forecast is welcome news – it remains subject to the volatile wholesale gas and electricity markets.”
How do I calculate my energy bill?
BELOW we reveal how you can calculate your own energy bill.
To calculate how much you pay for your energy bill, you must find out your unit rate for gas and electricity and the standing charge for each fuel type.
The unit rate will usually be shown on your bill in p/kWh.The standing charge is a daily charge that is paid 365 days of the year – irrespective of whether or not you use any gas or electricity.
You will then need to note down your own annual energy usage from a previous bill.
Once you have these details, you can work out your gas and electricity costs separately.
Multiply your usage in kWh by the unit rate cost in p/kWh for the corresponding fuel type – this will give you your usage costs.
You’ll then need to multiply each standing charge by 365 and add this figure to the totals for your usage – this will then give you your annual costs.
Divide this figure by 12, and you’ll be able to determine how much you should expect to pay each month from April 1.
Make sure you pay the lowest rates
There are two types of rates that you can pay on your energy bill, fixed or a standard variable rate.
A fix is when you lock in a set price for a certain period which is usually 12 months.
That is different to a standard variable rate which can go up or down depending on Ofgem’s price cap, which changes every three months.
A number of energy suppliers have reduced the rate of their fixed deals, meaning customers have a chance to save if they switch.
For example, EDF has launched a is £1,568 a year fixed deal for a typical energy user paying by direct debit,
This deal is £149 cheaper than the upcoming cap.
It is worth bearing in mind that you will still be charged more if you use more energy.
You check out the best fix rate deals below:
