Energy bills will fall..........
But that’s not the end of the story, as Paul Lewis elaborates
From 1 July the cost of electricity and gas in England, Scotland and Wales will fall, as energy regulator Ofgem lowers the cap on the prices. So just when we use less energy, the price goes down!
For the typical consumer who pays by direct debit, and has both gas and electricity, Ofgem says the price cut will mean a reduction of £129 a year or 7%. But that calculation is over a year and assumes the price will stay fixed for 12 months (though the cap is changed every three months). It’s better to look at the price change of each unit of electricity or gas and the daily standing charge: the amount you pay regardless of how much energy you use.
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If you have electricity and gas, it will still cost nearly £5.70 a week to be connected, and nearer £6.80 a week if you are on quarterly bills – even if you use no energy at all!
Overall, electricity charges have fallen by just over 4.5% and gas twice as much. So if you just use electricity you’ll see a smaller reduction in your bills than Ofgem’s 7%.
Prepayment meter customers now pay almost the same as those on direct debit. But the eight million who pay their bill quarterly as it arrives
have higher standing charges and pay more for each unit of energy they use. The biggest saving they can make is to change to direct debt. Energy suppliers also offer fixed rate one-year deals that are cheaper than the capped rates: search “best energy deal” at which.co.uk.
