Capped bills

[twordle]

Can anybody who understands energy billing/ govmt announcements please clarify how this 'capping' just announced works? Our monthly energy bills are around £500 currently.. does that mean once we've reached 5 months of such bills we don't pay anymore?! I mean great if that's so but surely not! Thanks

No it doesn't the unit price is being capped I think.

No it's not an all you can eat buffet!! If that was the case you could set your thermostat to 30 and open all your windows, all winter.

The headline figures are based on the "average household" which isn't helpful. You need to look at your unit usage. The cap is the maximum that can be charged. If you use a lot, you'll still pay a lot.

No it doesn’t mean that. It means for the average household based on usage. They have called the amount that can be charged per unit so the average household cost will be 2,500 if you use more you pay for it

No, they are capping the cost per unit which should work out around £2500 for typical use (2/3 bed house). If you use more then you'll pay more.

Not an all you can eat buffet, as already said. Whilst they talk about £2500 what they really men is the price per day and per kwh will be capped.

My rough estimates are that standing charges and caps might be roughly 27% more than where they are now (the difference between £1971 and £2500).

e.g. If you were paying 27p per kwh electicity on the SVR. It will go to 35p. Standing charge goes fom 45p a day to 57p a day.

The detail is not yet out, so they may choose not to increase standing charges but increase per pwh by a greater amount to still balance up at £2500 for a typical home.

If your bills are around £500 currently on the SVR then they are likely to be around £600 on this cap, I think.

e.g. £500 x 12 = £6000
£6000 + 27% = £7680
£7680- £400 (rebate) = £7280
£7280 / 12 = £606

Martin Lewis has just tweeted that, including the existing £400 promise, your bills will probably go up by 6.5% in total. You can also switch without penalty if you're on a fix.

But he also said for higher users the % will be higher - as the OP is a higher user if that cost per month is the SVR (not a fixed rate).

This is because the £400 is proportionally bigger on smaller bills than on larger ones.

I find this all SO confusing

I fixed a while back with edf, my unit rates/tariff at the moment are

Electric

49.65p per day standing charge
44.66p per kWh unit rate

Gas
27.22 per day standing charge
24.207p per kWh unit rate

can somebody please explain what this announcement means for me with having fixed?

I'm currently paying £101 pm dd which is supposedly in credit but I've not submitted a meter reading in a while (electric meter is in a bitch of a place to access!) I'm kinda terrified to do so!

Scared stiff of what's going to/is happening and don't understand it at all

Will check martin Lewis info too later heading out soon

This is all so anxiety inducing!

Do you know your annual kwh usage for electricity and gas @Graphista ?

No because I only moved in here in march

1st meter reading was 25/2/22

Gas 7295
Elec 25752.5

Latest

Gas 7384.1
Electric 26941.2

Why the frig don’t they just use unit charges in the headlines?

For anyone who still don’t understand totally ignore the amount you pay by direct debit, ignore the £2500 a year average etc etc…
The ONLY figure you need to look at is your unit rate.. With the new price cap the MAXIMUM UNIT RATE is around 10p for gas and 32p for electricity. (not exact figures just an educated guess at the mo) If you are paying more than this then you are worse off. Simple maffs innit.

This is being reported very pooly in the media.

They are not capping bills to £2,500 a year. They are capping the per unit costs.

I think a lot of people will use lots of energy without realising they still need to pay for it.

I’m on a fix too but I’ll be moving to the new capped rate which will be lower than I’m currently paying.
Your fix is also higher - 27p for gas!
The new rate will be around 9-10p I think.
It’s really unhelpful to quote average prices. Cost per kWh is needed for both gas and electricity and also there shouldn’t be a regional variation.
You don’t use much energy but there’s no point in paying more than anyone else.

Well there should be a regional variation. The north and wet west coast of Scotland is a different planet from the balmy SE of England. Its always colder up here.

I'm another one who is really confused about whether to switch from my fix to SVR
Currently 3 month into a 2 year fix, electricity 38p per kw/h standing charge 51p per day. , with gas unit rate 12p standing charge 27.5p.

Just under a year usage electricity was 3500 kw (I think!) gas 700 units approximately.

I hate the fact that I am so clueless over this, but as we need 3 x medical equipment running overnight, I am really worried over the electricity rises.

That is really helpful, thanks @pj20000

Yea I'm still taking it all in briefly looked at Martin Lewis post on fb. If I can switch without penalty to cheaper I will definitely be doing that asap, the switching sites are gonna get hammered between now and 1 oct!

Why do they have to make it so bloody confusing?!

the switching sites are gonna get hammered between now and 1 oct

Simply contact your current energy provider and ask to move to the capped variable rate. Why go via a switching site?

Will that be possible with current supplier? Will they let you?

Will that be possible with current supplier? Will they let you

I gather that the intention is that as part of the agreement the gov will force companies to allow customers out of their fixed rates without any penalty.

Still waiting for official confirmation though.

Does anyone actually know what the new price per unit is please? Can't find clear info on this!

I’m also looking for this but I don’t think it’s actually been released yet

Apparently it's 30% more than the current capped rates

So if you fixed for less great
If you didn't then end the fixed rate.

We'll know more soon and be able to make a decision.

@LimboLass thanks so much for taking the time to answer me

I'll switch to cheapest option available but I'm thinking they'll all be charging the same?

Makes sense I can ask current supplier to switch me to cheaper variable no penalty as then they at least keep me as a customer?

Crazy times