Ofgem has confirmed that the April 2024 Energy Price Cap will be £1690 for an average household.
This is a £238 drop on the January price cap and the lowest energy costs have been for two years. Russia’s invasion of Ukraine in 2022 sent fuel prices spiralling, resulting in record-high prices for consumers.
The two-year record low is a positive indicator for more affordable energy going forward. However, bills are still significantly higher than they were before the COVID-19 pandemic.
What is the Energy Price Cap?
The energy price cap is designed to protect consumers from sudden energy price jumps.
The cap sets a limit on the maximum amount a supplier can charge per unit of energy. Ofgem reviews the price cap every three months. If needed, they adjust the cap based on wholesale energy prices.
The price cap controls unit rates and standing charges for energy (see more below). It’s also expressed as an annual bill to make it easier to compare price caps. This annual bill is based on the average gas and electricity consumption of a 3-4 bedroom home and average regional rates.
What is the new April 2024 Energy Price Cap?
The new energy price cap is £1690 for a 3-4 person household paying by direct debit. This is a £238 drop in the annual average from January 2024. However, there are two things to consider when it comes to how this will change your bills.
First, your bills will still be based on your energy usage. Lower-usage households will see a smaller drop in bills, and vice versa. You’ll still be able to lower your energy bills by using less gas and electricity.
Second is that the April 2024 energy price cap is only in place until the end of June 2024. The price cap is adjusted every quarter based on wholesale energy costs. If the price cap goes up again in July or October your annual savings will be lower.
Current predictions are that bills will fall again in July before rising in October. However, energy prices are strongly tied to international trade and supply. As we saw with the invasion of Ukraine, global events can have a sudden and dramatic effect on bills in the UK.
April 2024 Energy Price Cap Unit Rates
These are the new gas and electricity unit rates and standing charges for April, compared to the current price cap. The rates shown are regional averages and are based on payment by direct debit.
|
|
Electricity (Apr) |
Gas (Apr) |
Electricity (Jan) |
Gas (Jan) |
Unit rate per kWh |
24.50p |
6.04p |
28.62p |
7.42p |
Daily Standing Charge |
60.20p |
31.43p |
53.4p |
29.6p |
Rates and standing charges are averages, which vary by region. Based on payment by direct debit and including VAT at 5%. If you pay on receipt of the bill your charges will usually be 6-8% higher.
Not sure how much you’ll be paying? We’ll be updating our bills calculator with the new rates at the end of March so you can estimate the new bills for your household.
How much will my bills be? Find out with our Utility Bill Calculator ›
Will the April 2024 energy price cap change my bills?
The new April 2024 energy price cap will apply to any customers on a variable tariff. These tariffs are used by default when you move home, or when your current tariff expires. If you’re one of these customers, you’ll be switched to the new unit rates on April 1st.
If you’re not sure what tariff you’re on, check your energy bill or speak to your supplier. Your tariff’s name will describe it as ‘fixed’ or flexible/variable’. If you’re on a fixed rate tariff, your bills won’t change under the new price cap.
