Energy bills to rise for millions across UK as Ofgem hikes price cap

The price cap is rising by £117 for customers on default tariffs

Caitlin Morrison
Thursday 07 February 2019 09:15 GMT
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Energy bills for millions of UK households are set to rise after Ofgem hiked its price cap due to higher wholesale gas and electricity prices.

The price cap, which was introduced in January at £1,137, will rise by £117 for customers on default tariffs, including standard variable tariffs on 1 April. The cap for pre-payment meter customers will also increase, by £106 to £1,242 per year.

The hike will affect around 15 million households across the UK.

The watchdog said the rise in the cap reflects a “genuine increase in underlying energy costs rather than supplier profiteering”.

Ofgem also said that its research suggested that default tariff customers would be paying around £75 to £100 a year more on average for their energy had cap not been introduced “even after today’s increase”.

Dermot Nolan, chief executive of Ofgem, said: “Under the caps, households on default tariffs are protected and will always pay a fair price for their energy, even though the levels will increase from 1 April.

“We can assure these customers that they remain protected from being overcharged for their energy and that these increases are only due to actual rises in energy costs, rather than excess charges from supplier profiteering.

“Alongside the price caps, we are continuing to work with government and the industry to deliver a more competitive, fairer and smarter energy market that works for all consumers.”

Richard Neudegg, head of regulation at, said: “People could be forgiven for feeling that they’ve been completely and utterly conned by the government’s energy price cap. Ofgem proudly proclaimed that the cap would cut bills by an average of £76 a year when it came into force at the beginning of January – but just weeks later, it’s announcing a jaw-dropping increase. It’s now crystal clear that households were never going to save what was promised.

“We are in a ridiculous situation where standard plans are likely to be in higher in April than before the cap was introduced. With bills set to soar by an average of £117 for 11 million homes, Britain needs to brace itself for a billion pound price hike.

“Energy suppliers have traditionally been the ones blasted for blaming price rises on wholesale costs. Now, shamefully, Ofgem is doing the same thing, as the reality of energy prices catches up with the political hype.

“With the cap being reviewed every six months, those remaining on default tariffs should be prepared for the possibility of a state-sanctioned shock to household budgets twice a year.”

However, Gillian Guy, chief executive of Citizens Advice, said: “Unfortunately price rises were inevitable as the cost of supplying electricity and gas to our homes has been increasing. As unwelcome as this news is, it’s likely that prices would be higher still without the cap and there are steps people can take to ease the strain on their bills.

“There are big savings to be made by switching supplier or tariff. Simple steps like topping up your insulation, or installing better heating controls, can permanently reduce your bills and make your home more comfortable.”


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