The 10% annual rise set by Ofgem matched the forecast predicted in June and means UK residents will pay an average of £1,717 per year on energy bills.
It means you will have to fork out around an extra £12 per month from today (1 October) to 31 December.
For a standard variable tariff, which is the default charge and pays for your electricity by direct debit, you will pay 24.5p per kilowatt-hour (kWh).
The daily standing charge this winter will rise by around 1p to 60.99p, based on the average usage in the UK.
To heat your home, gas will be charged on a standard variable tariff of 6.24p per kWh, with the daily standing charge priced at 31.66p.
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The new cap is £117 cheaper than at the same point in 2023 and follows two price cap reductions this year. However, finance experts predicted pensioners will be hit hard by the increased bill, following the Government’s decision to introduce a means-tested Winter Fuel Payment this winter.
Around 10 million people of state pension age will now miss out on a cash boost unless they receive certain Government benefits, including Pension Credit.
These include Universal Credit, Income Support, income-related Employment or Support Allowance or Jobseeker’s Allowance.
Myron Jobson, senior personal finance analyst at Interactive Investor, said the rise is a “double whammy for pensioners living on the breadline”.
Jobson said: “On one hand, they face an uptick in energy costs, while on the other, they’ve lost a crucial financial support that once helped them manage these bills. This harsh combination risks plunging many into deeper financial hardship.”
Pensioners were urged by the Government earlier this week to check if they are eligible for Pension Credit and, therefore, the Winter Fuel Payment.
Almost 900,000 UK households are currently not claiming the financial support they are entitled to.
You will qualify for the payments if you receive the state pension and you:
- Have a weekly earning of less than £218.15 if you’re a single person
- Have a weekly earning of below £332.95 if you’re in a couple
However, Age UK said there are concerns the initiative from the Government is too late.
Pensioners on low incomes ‘horribly exposed’ to price hike
Caroline Abrahams, the charity’s director, said: “There’s scarcely any time to tackle the long-term under-claiming of Pension Credit – for more than a decade, a third of pensioners who are entitled to it have consistently missed out.
“And the million or so older people whose small incomes take them just above the line to claim are horribly exposed – no take-up campaign can help them.”
Regarding the rest of the UK, the £149 increase in yearly bills could negate the impact of a steady inflation picture and the base rate reduction, according to Jobson.
He added: “Energy prices have a direct and immediate impact on monthly expenses, and for many, this increase could offset the benefits of lower inflation elsewhere.
“This means that despite the broader economic indicators showing improvement, the cost of keeping the lights on and homes warm will continue to strain tight budgets.”
