Scotland Times

Sunday, Apr 14, 2024

Energy bills could go up before October price cap rise

Energy bills could go up before October price cap rise

Energy bills could increase ahead of the expected rise in October, the UK's energy regulator has revealed.
Ofgem and industry body Energy UK said it was "possible" for suppliers to raise customers' direct debits before the new cap on energy prices kicks in.

Any rises would be to help spread the cost of higher energy use in the winter months, Ofgem said.

Households have been warned of sharp rises in energy prices, with average bills forecast to reach £4,200 in 2023.

Ofgem said direct debits are usually charged in a way so that customers build up "credit" during the warmer summer months when usage is lower, to spread out the cost of using more energy in the colder months.

"It's therefore possible for direct debits to increase ahead of a price cap rise or even when a customer's use has remained constant," an Ofgem spokesperson said.

However, Ofgem said customers can ask for their excess credit to be "returned at any time and can contact their suppliers to change how their direct debit is spread".

"For example, they pay for exactly what they used in that month and do not build up a credit ahead of winter," Ofgem said.

Ofgem confirmed direct debits could be increased before October, after Martin Lewis of Money Saving Expert, told the Today programme that direct debits were going to "start rising pretty much immediately on the 26 August before the new prime minister's in place".

"As soon as the announcement is made from Ofgem on the 26 August, that crystallizes the direct debits going up," he said.

The BBC has contacted British Gas, EDF, Eon, Ovo Energy and Octopus for comment.

Energy UK, the trade body for the energy industry, said direct debits were "reviewed periodically" with suppliers taking into account factors including estimated usage, current tariffs, debit/credit balances and recent meter reads.

"It is, therefore, possible some customers' direct debts will change in advance of October," a statement said.

"All suppliers must, however, ensure that direct debits are set correctly based on all relevant information available at the time of review, and that they communicate any changes in a way that helps consumers understand their payments for energy."

A new price cap - determining the maximum suppliers can charge customers for energy usage in England, Scotland and Wales - is due to be announced at the end of this month, but will come into effect in October.

Consultants Cornwall Insights expects this to rise to £3,582 a year, due to the ongoing war in Ukraine pushing up global wholesale gas prices, and have warned of further rises over the winter.

Ofgem said protecting consumers was its "top priority", adding "suppliers must ensure that direct debit payments are based on the best and most current information available to them".
Newsletter

Related Articles

Scotland Times
0:00
0:00
Close
UK Island Orkney council to look at proposals to become territory of Norway
Woman Awarded Over £100,000 After Being Fired for Transgender Tweet
A provocative study suggests: Left-Wing Extremism and its Unsettling Connection to Psychopathy and Narcissism
A Real woman
Brand new security footage has just been released to the public showing the Active shooter Audrey Elizabeth Hale drove to Covenant Church School in her Honda Fit this morning, parked, and shot her way into the building
China's foreign ministry branch in Hong Kong urges British gov't to stop the biased and double standards Hong Kong report
Double standards: UK lawmakers attack EU chief over Ireland claims
Democracy? Not for UK. UK PM rejects Scottish independence referendum, cancel democracy in BVI
UK urged to brace for economic storm
Women's own body dissatisfaction appears to influence their judgment of other women's body sizes
Prince William To Move Family Into Cottage Near Queen Elizabeth II
BOOOOOOS: Tony Blair receives royal honour
Captured Britons sentenced to death in Ukraine
Barbados PM Mia A. Mottley among Time Magazine’s 100 Most Influential People
Today's headlines
"Just One Of the Boys In School:" Years That Shaped Prince Charles
BVI Premier Rubbishes Claim Of Causing COI Delay
Comments on "Human Intelligence in a Digital Age" - A brilliant Speech by MI6 Chief Richard Moore, and the elephants neglected in the room
Bitcoin: BoE Deputy Gov wants to cancel democracy and protect the banks with regulations which infringe on people’s freedom, independence and benefits they get from their own money.
What are the Pandora Papers?
Taiwan-China relations at their 'worst in 40 years'
The attempt to hold Epik.com accountable for the content of its clients' websites is like blaming Gutenberg for the NYT's fake news that dragged the US into the pointless war against the nuclear weapons Iraq never had
×