Ofgem energy price cap predicted to fall to £1,823 a year
Ofgem energy price cap predicted to fall to £1,823 a year
Bills likely to rise again from January and consumer groups say energy costs remain ‘dangerously high’
I don't know if people are aware of the fact that you can see the wholesale price of energy but there are is a website that tracks it.
https://energy-stats.uk/wholesale-energy-pricing/
This clearly shows that wholesale energy prices this year have been lower than they were in 2021. Yet the price of electricity charged to people is much higher now than it was then.
This is the best summary I could come up with:
The typical gas and electricity bill will fall to an average of £1,823 a year from October after the regulator Ofgem announces its energy price cap next week, a leading forecaster has predicted.
Lowrey said: “As many, including energy regulator Ofgem, have acknowledged, it is essential that the government explore alternative solutions, such as social tariffs, to ensure stability and affordability for consumers.”
Ofgem’s chief executive, Jonathan Brearley, told the Guardian this week that ministers should rethink whether the “very broad and crude” price control was still fit for purpose during the energy crisis.
The price cap was designed to ensure energy bills were fair by calculating what it cost suppliers to provide gas and electricity to their customers.
Simon Francis, a campaigner at the End Fuel Poverty Coalition, said: “This coming winter will not feel any better than last, as energy bills remain at dangerously high levels.”
The price cap only dictates the maximum a supplier can charge per unit of energy, based on the annual consumption of a typical home.
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Does anybody know where you can find the historic price caps, preferably in pence per kWh and standing charge?
This clearly shows that wholesale energy prices this year have been lower than they were in 2021. Yet the price of electricity charged to people is much higher now than it was then.
Yes, but the price cap in 2021 was set with a scheme that used the last 6 months of wholesale prices to set the cap, and now the scheme uses the last 3 months. So back then, then last 6 months had been low prices (2020 was especially low). Today the last 3 months have been dropping from higher prices.
This is why, right now, the best deals are on tariffs which are based on the wholesale price today. Day trackers or agile. However, if you're worried about the wholesale price going up over winter you may want to consider locking in a price now. Personally, I'm not expecting massive fluctuations as Europe is much better prepared this winter than last.
I'm coming off a two-year fixed deal which was locked st 20p kWh, what's the feeling in the UK, should we lock in again?
Martin Lewis covers this topic regularly on his BBC Radio 5 podcast with figures and concrete advice and calculations.