The dreaded Energy bills increase is arriving soon. Although it was expected to increase, the actual amount is shocking.
It has now been announced that energy bills we be increasing by a massive 54%, as the new price cap has been confirmed. This is due to Ofgem raising the price cap on both standard and default tariffs with around 60% of household being on the standard tariffs.
Unfortunately this sees the current price cap of £1,277 a year increase to £1,971 per year, per household.
The new prices from the energy bills increase come into place from 1st April 2022 and will likely increase again in October 2022. However Martin Lewis meet with the Chancellor, who stated that it is likely to start coming down again from April 2023 but cannot be guaranteed.
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Should we switch tariffs?
It has been advised that it is best to stay put with our current suppliers as moving to another supplier will not decrease our prices and would like make them higher.
Can we get any help?
Yes. The Government has confirmed that many households will receive £350 in support. However £200 out of the £350 will be an interest free loan. This will be paid back at £40 a month for five years. The loan comes from government state-backed loans totalling over £9 Billion which will be made available in England, Scotland and Wales.
This breaks down as:
- £200 rebate loan in October to all households. It’s an automatic £200 discount on your bills, regardless of what tariff you’re on.
- £150 council tax rebate in April for those in council tax bands A to D. This applies in England households only. (doesn’t require payback)
- The Chancellor announced a total of £565 million in funding for the Scottish, Welsh and Northern Irish Governments to provide support to their households.
- The support is a fixed rate, meaning you get the same wherever you are.
Will £700 be the Maximum people will pay?
Unfortunately not. The price cap sets a limit on the rates you pay for each unit of gas and electricity, meaning if you use more than the limit, you’ll pay more. Under the price new cap, the rates on average (depending where you live) are around 7p/kWh for gas as well as 27p per day standing charge. Electricity has a standing charge of 45p per day (again depending on area), and is around 28p/kWh.
How can we save money elsewhere to cover this?
Downloading a money tracker app may help as it will show you where your money is going and helps you identify where savings could be made.
I haven’t personally used any money trackers, you I won’t recommend however I would suggest researching some on google.
Using cashback app can save you and earn you lots of money for buying exactly the same as you do already.
I personally use all of these apps. More information can be found here: Free Money
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