In October, 22 million consumers’ energy prices would rise 42%. Ofgem CEO Jonathan Brearley said the new energy price cap will be “about £2,800” per year, up from £1,971.
This £829 rise won’t be official until August, but families can’t wait until then to prepare for it.
How to handle the increase of the energy price cap
Average monthly energy bills will be £233 in October 2022.
That’s £69 more than currently and £58 more than before April 2022.
Your October 2022 energy bill will be £127 more than October 2021’s.
This huge spike will have far-reaching implications.
Government aid?
The Cost of Living Support package will help with skyrocketing energy expenses.
This programme will offer all English, Scottish, and Welsh families £400 to offset the energy cap hike.
This money will be deducted from your energy bills over six months, commencing in October.
Low-income families will get £650 in July and September.
To qualify, you must receive a means-tested benefit:
- Child tax credit
- Income Support
- Income-based JSA
- Income-related ESA
- Pension Credits
- Universal Credit
- Working Tax Credits
Pensioners will get a one-time £300 stipend. If you’re 66 or older on September 25, 2022, your energy expenses should be reduced.
Disabled families would also get £150.
This is for anybody who gets one of the following:
- Independence Payment
- Gratuity
- Regularity Allowance
- Income Support
- Disability Insurance
- Disability Benefits Scotland
- Mobility Supplement
Will this help your bills?
From October 2022 to April 2023, the government will add to your energy costs.
Without the incentive, your energy prices would rise £415 over six months, but you’ll only spend £15 extra.
This will help millions, but it doesn’t account for the earlier price ceiling increase.
Is government assistance sufficient?
The government’s help is inadequate since it doesn’t address the jump of 54% to the energy price cap in April 2022.
The typical home will spend £2,386 for electricity from April 2022 to March 2023.
This family paid £1,296 extra from April 2021 to March 2022.
Even the lowest income families would only get £1,050 in overdue payments, meaning their bills will rise by £246.
Pensioner-only low-income families will have their energy expenditures subsidised by the government.
Most houses will only get a £400 subsidy, so they’ll spend £896 more for energy than last year.
The assistance package ends in April 2023 when the price ceiling increases.
6.5 million homes suffer in fuel poverty due to prior price limit hikes. This is when paying enough to effectively heat your home puts you below the poverty line.
This programme won’t stop more houses from falling into fuel poverty.
What’s the gas bill hike?
From October, the average gas bill will be £116.
Every monthly gas bill will climb £34.
Gas will cost 10.5p per kWh, up 3.1p.
Daily standing fee rises from 27.2p to 38.7p.
What’s your power bill hike?
Typical monthly energy bills are £117.
That’s £35/month more.
Electricity will cost 40.3p per kWh, a record high.
New average daily standing charge: 64.4p, up from 45.3p.
What will your boiler’s operating costs be?
Gas boiler operating expenses will climb from £420 to £628 between October 2022 and April 2023.
In six months, your heater costs £208 more.
Gas will cost 10.5p per kWh, up from 7.4p.
Heat pumps?
Heat pumps utilise energy, therefore their operating expenses will rise from £560 to £800.
You’ll spend £240 extra to utilise a heat pump.
Domestic power prices rose from 28.3p per kWh to 40.3p per kWh.
Solar panels: profitable?
Solar panels will be more lucrative following the 2022 price ceiling hike.
The typical UK home with new solar panels will break even in 6.7 years at 40.3p/kWh.
Before April 2022, it would’ve taken 11.3 years to break even on power.
Using the Smart Export Guarantee, a three-bedroom home may now earn £13,000 by purchasing solar panels.
They’ll save £357 on power between October 2022 and April 2023.
How to lower bills?
60% of UK people said increasing energy expenses prompted them to switch to green energy.
Best option: solar panels. If you can afford the £4,800 cost and apply the Smart Export Guarantee, you’ll save your power expenses by 59%.
Insulation may help make your house more energy efficient.
Roof and loft insulation can save £225 annually, cavity wall insulation can save £255 annually, and solid wall insulation can save £435 annually.
There are easy and affordable possibilities:
- Draught proofing can save £50 per year
- Not overfilling your kettle can save £47
- LED lights save the typical household £40 per year
If you can’t pay your energy bills, contact your provider. They may be able to lower or suspend your payments.
Read Elite Groups ‘8 Ways To Save Energy At Home‘ for additional energy-saving strategies.
