The figure has prompted warnings that the cap does not represent a maximum total bill, as the amount households pay still depends on their energy consumption. Consumers are being advised to review their tariffs, monitor usage and understand how the new rates will affect their own circumstances.
Ofgem Confirms 4% Rise as Energy Costs Remain Linked to Global Markets
Ofgem has set the new price cap at £1,723 from October 1, compared with £1,663 for the previous July to September period. The regulator said the increase reflects continuing pressure from high international gas prices.
According to Ofgem’s director general for markets, Neil Kenward, global gas prices are continuing to influence energy costs in the UK. He said the government’s decision to remove VAT from domestic electricity bills between October and March would prevent households from facing even higher costs during the winter period.
The new cap applies to standard or default tariffs and limits the unit rates and standing charges suppliers can charge. It does not mean every household will pay £1,723, as bills vary depending on how much energy is used.
Gas prices under the cap will move from 7.33p to 7.97p per kilowatt hour, while electricity prices will change from 26.11p to 26.32p per kilowatt hour. Electricity standing charges will fall from 57.19p to 54.83p per day, while gas standing charges will rise from 29.04p to 29.68p per day.
Households Advised to Review Tariffs and Reduce Avoidable Energy Use
Energy specialists have warned customers not to assume the price cap guarantees an affordable bill. Molly Monks, an insolvency specialist at Parker Walsh, said the term “price cap” can create the impression that no household will pay more than the announced figure, despite actual costs depending on consumption.
She advised customers to check their tariff details, monitor their usage and provide accurate meter readings before the new rates begin. According to Monks, households should understand whether they are on a fixed deal or a standard tariff, as the impact of the price cap varies between customers.
Energy-saving measures have also been highlighted as one way households can limit costs. British Gas data shows that devices left on standby, sometimes described as “vampire devices”, can add to annual electricity bills.
The company’s energy expert Marc Robson recommended switching devices off at the mains when they are not being used. According to the Energy Saving Trust, turning off unused appliances could save households around £55 a year, although the exact amount depends on appliance models and individual usage.
The organisation also estimates that consumer electronics account for around six per cent of a typical household’s energy bill. With bills changing from October, advisers say simple adjustments to everyday habits may help households manage their energy spending more effectively.
