Regulator gives green light to £96 energy price hike from April
Ofgem has announced that, for six months from 1 April 2021, the price cap will increase by £96 to £1,138 for 11 million default tariff customers, and by £87 to £1,156 for 4 million pre-payment meter customers.
Tom Lyon, director of energy at energyhelpline.com, said:
“Today’s announcement gives suppliers a green light to hike prices for millions of consumers who are already struggling with higher bills due to lockdown restrictions.
“The number of households in energy debt to their electricity provider has already hit a five-year high, with 777,000 owing money to their provider between July and September last year – the highest figure since 2015. This price cap rise is a hammer-blow for customers and will only increase the surge of energy debt this year across the country.
“It’s particularly unfortunate that price rises sanctioned by the cap will disproportionately affect the most vulnerable groups in society, including the elderly and low-income families.
“Although suppliers will be allowed to raise default tariffs prices, they do not have to. We call on providers to hold off any price increases to help households continuing to be hit hard by the pandemic, as hopes rise for the easing of restrictions from the vaccine roll out. Even just holding off for a few months could help with the financial survival of millions of consumers nationwide.
“While the price cap affects some of the most expensive deals on the market, fixed deals are unaffected and switching to a competitive fixed tariff will lower bills and lock in prices for 12 months or more. However, rising wholesale costs have increased the prices of the most competitive tariffs on the market by 17% since last April, so consumers are strongly advised to switch and fix sooner rather than later.”