Energy price cap to increase by £693 from April

‘The energy price cap will increase from 1 April for approximately 22 million customers. Those on default tariffs paying by direct debit will see an increase of £693 from £1,277 to £1,971 per year (difference due to rounding). Prepayment customers will see an increase of £708 from £1,309 to £2, 017,’ says Ofgem. The increase is driven by the rise in the global gas prices over the last 6 months and will affect the default tariff customers who haven’t switched to a fixed deal and those remain with their supplier after their previous supplier left the market. The price cap is updated and tracked twice a year, specifically for energy and other costs. The cap stops energy companies from making excessive profits, which helps customers pay no more than a fair price for their energy. However, when the price cap increases, it gives the companies the liberty of raising prices for all customers. Jonathan Brearly, chief executive of Ofgem, said: ‘“We know this rise will be extremely worrying for many people, especially those who are struggling to make ends meet, and Ofgem will ensure energy companies support their customers in any way they can. Ofgem is working to stabilize the market and over the longer term to diversify our sources of energy which will help protect customers from similar price shocks in the future. ”The chancellor, Rishi Sunak, responded by announcing a plan to ease the pressure on households, with £350 of support, which includes £200 off their household’s energy bills. However there will be a repayment plan, over five years, from next year – and a £150 discount off council tax. Among those affected by the price cap hike will be former customers of the 29 energy suppliers that have collapsed in the wake of the wholesale gas price surge, affecting a total 4.3 million domestic users. How bad is this for consumers? Scott Byrom, chief executive of The Energy Shop, said today’s announcement of energy price increases was “higher than was expected”. He told Sky News that the 54% energy bill rise is “a staggering amount”. “It’s a record. It’s the biggest increase I’ve seen. The biggest concern here is when we had a 35% price rise in July 2008, the message was to switch and even say customers could reduce their energy bills by hundreds of pounds, and that’s just not an option right now.” Mr. Byrom said that unfortunately for consumers, “this is a pill we need to swallow whole, as hard as that is”. What to do next The best advice we can give out is to research whether you as a customer will be affected by the price cap rising. If you recently left a supplier that has exited the market and are not on a fixed rate contract for your energy, you can be receiving notice of your bills increasing from the 1st April. At SwiftSwitch, we can consult and advise you on the market and ensure we find the right price for you.  SwiftSwitch provides a price comparison / switching service to UK businesses. To be eligible to use this service, our terms and conditions ; A business that is resident in the UK; Eighteen years or older (if a sole trader); Meet the credit scoring requirements of any supplier (if applicable) We reserve the right to refuse to provide our services to any customer at our discretion. If the customer agrees to use our services, SwiftSwitch will use its reasonable endeavours to identify, negotiate and secure competitive energy prices. Energy prices are obtained from a panel of energy suppliers using price books provided by suppliers. The customer agrees to provide SwiftSwitch with accurate information to allow accurate quotations to be obtained – including estimated or actual usage of energy, contract end dates and other know factors that may influence prices and quotations. The provision of a quotation by a supplier via SwiftSwitch does not constitute an offer to the customer and offers will each have their own supplier’s terms and obligations attached. If the customer accepts a quotation and a contract is executed between the customer and the supplier, the contract is binding, and the customer will not be permitted to revoke such an acceptance. The supplier shall be entitled at any time to refuse to accept a customer’s offer of acceptance at their discretion. If the customer and supplier wish to enter into a contract, SwiftSwitch will provide a switching service (or renewal service) which will include organising the contract between the customer and the energy supplier for the purchase and supply of the energy services. SwiftSwitch will not be responsible for any delays or failures caused by either the customer, the proposed supplier or any existing supplier in relation to effecting either a transfer of supply or renewal of supply. SwiftSwitch makes no guarantees as to either the quality of the service suppliers operates, or the prices obtained at quotation. Energy prices fluctuate on a daily basis and whilst we attempt to help secure competitive rates to enable switching or renewal, we cannot guarantee any quote is the cheapest. The customer is reminded that ultimately it is their responsibility to validate the accuracy of any quotations presented. The customer acknowledges that they are entering into a contract with a supplier for the provision of energy supply and not with SwiftSwitch. The customer agrees that SwiftSwitch is not liable in any way for any dealings, contracts or transactions between the customer and the supplier and that any such transactions, contracts, dealings or payment obligations are the customer’s responsibility and risk. The customer agrees by using the service that SwiftSwitch is an independent energy brokerage and that SwiftSwitch is not instructed by the customer to act as their agent or representative. The customer agrees that SwiftSwitch are not responsible for the provision of any supplier services.

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