What the Latest Energy Bills Price Cap Update Means for UK Homes

Energy prices have dominated the news for most of 2022, causing a knock-on effect for the cost of living more broadly. That was the first thing on the agenda for new Prime Minster, Liz Truss, who announced a new, lower cap going forward.

It’s understandable if the constantly changing energy bills price cap has left you confused. To make things simpler, we’ll recap how things have changed, outline the new update in simple terms, and discuss the best course of action for UK homes…

Energy bills price cap timeline

April 2022 – The price cap was increased by 54%, from £1,277 to £1,971 per year for the average UK household. This was seen as a response to higher wholesale prices, following a global shortage in the wake of the pandemic.

August 2022 – Ofgem announced that the price cap would rise to £3,549 annually for an average household from October 2022. This was reportedly down to worsened market conditions due to Russia’s invasion of Ukraine, though many questioned why energy companies were reporting record profits.

September 2022 – A new two-year price cap is introduced for October 2022 onwards, with £2,500 the reported figure for average households over a year. Energy companies will be able to claim back any profits lost from the taxpayer, with an estimated cost of £150 billion.

Unpacking the price cap

Price caps are often reported, as above, using the annual figure for an average household. While that makes it easier to understand their impact, it can be slightly misleading. Energy bills can be higher than the headline figure of £2,500 per year, depending on your usage.

The energy price cap actually caps the cost companies can charge domestic customers per unit, as well as the daily standing charge. From October 2022, that will be as follows:

• Electricity – 52p per unit & 46p daily standing charge
• Gas – 15p per unit, 28p daily standing charge

In other words, you won’t be able to use energy freely with the reassurance of a £2,500 limit. Your bill could still exceed that amount, meaning it’s more important than ever to improve your home’s energy efficiency, reduce how much you use, and stop your bills getting out of control.

How SprayCork can help

There are various ways to reduce your overall energy bills, such as energy-efficient appliances and renewable heating systems. However, if you really want to counteract the rising energy bills price cap, it’s hard to see past high-performance wall insulation like SprayCork.

Thanks to its high cork content, the solution naturally prevents heat from escaping your home – meaning you don’t need heating on as high or as long to maintain a comfortable temperature. Whether you choose an insulative external render or internal wall insulation, you can expect savings of up to 30%.

What better way to prepare your home for the winter? To arrange a quote, give us a call on 01484 442 420 or email [email protected].