Ofgem has announced the new energy bill price cap will rise by 54 per cent from April.
It means energy prices will rise by £693 a year for millions of households after regulator Ofgem hiked the price cap on bills to £1,971 or 54%.
The energy regulator is responsible for the energy price cap which limits how much providers can charge customers on their energy bills.
The increase follows a 12% rise in October and will take effect from April.
The price cap applies to around 15 million British households who have chosen to pay for their electricity on the open market rather than under fixed-price deals.
The current energy price cap is £1,277 and is reviewed twice a year with the next change to begin in October where rates could rise even further.
What is the energy price cap?
Energy regulator Ofgem has created a helpful video explaining exactly what the energy price cap is.
Watch it here:
🙋A question we often hear is “what is the price cap?”
— Ofgem (@ofgem) January 25, 2022
While we don't increase or decrease the price of energy, we calculate the level of the government's #EnergyPriceCap that applies to default energy tariffs.
This may affect you. See how it works📺 https://t.co/7SyVaj2ogq pic.twitter.com/4wqpvMDGpl
Rishi Sunak to announce support for UK households amid energy price rise
Chancellor Rishi Sunak will announce support to ease the pressure on millions of households facing soaring energy bills.
According to the Times, Mr Sunak will commit to giving households in council tax bands A to C rebates funded by Government grants under targeted measures for poorer households.
The Treasury did not rule out the move nor did it deny that the Chancellor could announce state-backed loans to give all homes a discount on their energy bills of £200.
Boris Johnson is under vast pressure to ease the cost-of-living crisis, with his leadership under threat over No 10 parties, but the new support is unlikely to be enough to prevent energy bills rising significantly for most people.
The Chancellor will address the nation in a major press conference amid the rising cost of energy bills.
The Downing Street press conference will begin at 5pm today and will be televised on all major news channels.
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