What is the Energy Price Cap?

The energy price cap sets a maximum price that energy suppliers can charge customers for each kilowatt hour (kWh) of energy they use and what the maximum daily standing charge can be.

The price cap is set by Ofgem every quarter.
The price cap may differ depending on your region and the way you pay for your energy.
Ofgem normally give an annual cost based on a dual fuel household paying by direct debit. This is to give an idea of what a typical household could pay, but every customer’s bill will be different.

The average cost between January 2024 and March 2024 is £1,928 for a typical direct debit customer.

The average cost between April 1st 2024 and June 30th 2024 is expected to be £1,660.

What do I need to do?

Each quarter when the price cap changes, you should take meter readings and provide them to your supplier. This will help your billing to be accurate and stop any estimated bills where you can end up paying for more energy than you have used.

Fixed rate tariff customers

If you have a fixed rate tariff set at a rate below the cap you will continue with that rate and your bills will not be affected, if you have a fixed rate that is higher than the cap you will again continue to pay this rate as fixed rates are not affected by the cap.

Prepayment Meter Customers

If you have a smart prepayment meter, the costs will automatically change with the price cap. If you have a traditional prepayment meter they will be updated when you top up with your key or card.

Multi-Rate Meters (e.g., Economy 7)

Suppliers have flexibility to apply slightly different discounts to the individual rates within the tariff, helping to balance-out the reduction of more expensive day rates with cheaper night-time electricity rates, so long as together, their average price does not exceed the Energy Price Cap.

(This means the day price may be higher than the cap, for example). Each supplier will approach this differently. Your supplier should communicate this to you.

Unit rates and standing charges between 1st January and 31st March 2024.

*Assumes payment via direct debit or prepayment and includes VAT (at 5%). For those who pay each month after getting a bill, it’s typically 6% higher.

Customer reference number

This is your identification as a customer of the supplier. The number may be required when you contact them and should be used on any correspondence with the supplier.

Period covered by the bill

This is the billing period that your bill covers. Any measurement of your energy use and cost described in the bill is for this billing time-period. This time-period will be 3 months (quarterly) unless your contract says otherwise.

Amount Owed / Balance / Amount Due

This is the amount of money that you owe for the usage during the time-period billed. This will either be a credit balance (can show as ‘CR’ or as a minus figure, e.g., £200CR), or where you owe the supplier money (debit balance – as a positive figure e.g., £200). It is important for you to check that this amount is correct and if you believe it is not, or wish to query the amount, you should contact the supplier.

Personal projection

This is an estimation of how much the current tariff will cost you over a 12-month period. The purpose of this is for you to evaluate the cost-effectiveness of your tariff and consider future energy bills. It is important to note that this is not necessarily the exact amount you will pay, only an estimation based on your previous usage.

Electricity usage / Consumption value

This is the amount of energy that that you have used during the billing period. It will be displayed in kilowatt hours. A kilowatt hour describes a kilowatt (1000 watts) being used for an hour. Working out the amount each appliance consumes/will consume in electricity can be found by multiplying the wattage of the item with the number of hours used and divide by 1000, e.g. a 100-watt appliance used for 10 hours will use 1000 watts. Dividing this by 1000 results in 1 Kilowatt hour.

Kilowatt hour formula:        (appliance consumption X hours of use) ÷ 1000=kWh

E.g. (100 X 10) ÷ 1000=1 kWh

Gas usage / Consumption Value

Gas usage is measured in cubic meters or feet, with the consumption showing on the bill or statement as an ‘m’ or ‘ft’ with a small number ‘3’ next to it. ‘Cubic metres’ describes the ‘metric’ measurement and ‘cubic feet’ the imperial measurement. It is important that you understand what your meter is measuring to ensure you are being billed correctly, and this should be displayed somewhere on the meter. Smart meters may have the option for both displays. There should be a calculation showing on the bill to convert one into the other.

Estimated/actual energy usage

This confirms whether the bill is estimated or an accurate representation of your energy use. The bill will only be estimated if you are not using a smart meter or have not given a meter reading to the supplier for this billing period.

QR code

This code can be scanned by your smart phone to provide additional information on your supplier’s services (e.g. up to date rates for tariffs). The supplier’s QR code app will be needed to use this and can be found on any phone app store available to you.

Fixed term contract end date (fixed term tariff users only)

This determines the date that your fixed term tariff contract will end. This kind of tariff uses a fixed rate of energy pricing for a designated period. If you want to end the contract before this end date, consider the exit fee outlined in your contract before making a decision to end or change supply.

Breakdown of the costs

This section will explain how your bill is calculated, considering the three sources of cost:

Firstly, your energy usage cost will be calculated by multiplying the amount of energy you used (measured in kilowatt hours for electricity or cubic feet or meters for gas) by the energy price rate of your tariff. You may have a tariff with two rates, in which case both will be displayed and individually calculated.

Secondly, there is a daily standing charge that must be paid on top of energy usage costs. This must be paid regardless of energy usage and can be the reason that some consumers fall into debt with their supplier, despite using very little energy during certain periods.

Thirdly, you must pay value added tax (VAT) for the energy you purchase because it is a taxable transaction of goods and services.

Current Tariff

This section gives the name and basic details of your current tariff. If you are unsatisfied with your tariff, it would be worth researching alternative options and/or contacting your energy supplier to discuss this.

Exit fee

This is the amount that will be owed if you choose to leave your current tariff before its end date.

Payment method and billing interval

This shows how often you will be billed. This can be once every 3 months (quarterly) or monthly, but you should check your contract if you have any doubts. It also displays whether you have a credit or prepaid meter and the payment method (e.g. direct debit).

Previous and current meter readings

This section is a display of two-meter readings, each with a date. One is what your meter reading was at the end of your previous billing period and the other was the energy meter reading at the end of your current billing period.

Meter reference number

This is the number that is used to identify your energy meter. This number is essential if you wish to find out who your supplier is or to change your supplier.

You can get more information on reading an energy bill, as well as examples by downloading our factsheet by contacting us directly.

Who is responsible for the energy bill?

There are ways for you to find the person responsible for paying an energy bill, the first of which is to check who is named on the bill. The person named on the bill will be responsible for the costs unless you are a tenant.

Can a landlord charge a tenant for energy?

Your landlord can only charge you for energy if you are not paying the energy bills directly to the supplier. If energy costs are paid to the supplier by the landlord, they can only charge for the units of energy you have used, your share of the standing charge and the VAT. If an estimation of energy units used needs to be made, the landlord must be accurate in their reading of the meter. It is possible for you to take your landlord to the housing tribunal if overcharges occur.

What do I do if my landlord hasn’t paid the energy bills?

As a tenant, you can’t be deprived of any service that is needed to use the rented property as your home. This means that the landlord can’t deprive you of energy if you rent your home. If your landlord has not paid their energy bills, contact the supplier, explain the situation and request that disconnection be postponed if the supplier has given warning. You can also request that the supply be put in your name instead, allowing costs to be paid directly to the supplier instead of the landlord. Alternatives are to take legal action against your landlord or to contact the local authority on the matter.

Is the price of my energy capped by the energy supplier?

If you are on a prepayment meter or on a standard variable tariff (prices change depending on the market) or a default tariff (a tariff not chosen by you), there is a price cap on energy. This an automatically applied limit on the amount that can be charged but this applies to the rate and not to the amount being used (i.e. more usage still leads to a higher price). The caps on energy prices will vary based on your location and meter type.
The levels of price cap can be found by visiting:

https://www.ofgem.gov.uk/energy-price-caps/levels-energy-price-caps

I am in credit with my energy supplier – how do I claim this back?

If you overpaid for energy by direct debit, you will be in credit and entitled to any payment over the correct amount. This usually happens when the bill is estimated, and you end up using less than expected. The supplier may reduce your monthly payments to cover what you are owed or refund you at the end of the year. However, it may be necessary to claim your credit back from the supplier.
In order to do this, you should contact the supplier directly. You might also need to provide a current meter reading for the refund to be approved. It might be preferable to keep the credit on your account to reduce bills for future months with higher costs, especially heading into the winter months. If the supplier refuses to refund your credit or reduce bills to cover overpayment, you can make a complaint to them directly.

Should my energy supplier inform me of any price increases?

If an energy supplier is increasing their prices, they have an obligation to give you a reasonable amount of notice before it is put in effect. The exceptions to this requirement are staggered tariffs (where the prices change on set dates that you were previously informed about) and tracker tariffs (where prices change on a regular basis). If you want to avoid price increases, it is wise to compare different tariffs. If you change tariffs or suppliers, the transfer must be completed by the new or current supplier within 20 working days of the request.

What are dynamic teleswitched (DTS) meters?

A dynamic teleswitched (DTS) meter is an uncommon type of energy meter that gives different electricity prices at specific times or in proportion to the amount of energy being used by others. Not all suppliers use DTS meters and it is best to compare them alongside alternative non-DTS tariffs when deciding whether to use one. Removing a DTS meter is considerably expensive. You should find the exact cost of installation and removal before deciding to use one. You can do this by contacting your supplier.

The expected layout of energy bills that you receive will vary in style, presentation and length depending on your energy supplier. All energy bills will ultimately display the same information but will do so in different ways. It is important to remember that this information may be in a different order and named differently than presented, depending on the supplier.

British Gas

EDF Energy

EON

Npower

Scottish Gas

Scottish Power

OVO

If you feel that you are paying more than you should for energy or are struggling with your bills, contact your energy supplier to negotiate a better deal.

If the supplier will not provide you with a better deal, search for another supplier and/or another tariff. 

If you have been making payments to your landlord for energy bills and they have not been paying, you cannot be chased for the debt if it is not in your name.

If the account is in arrears, then the energy company may consider disconnecting the supply.

If you are in a position where disconnection has been threatened, you can request that the supply is switched into your name.

You should outline your concerns to the energy provider in writing, supplying evidence that you have been making payments to the landlord for utility bills with your rent (copies of bank statements paired with tenancy agreement will suffice).

If you have been disconnected already, you should also contact the energy supplier and discuss the situation with them.

Being transferred to a new supplier can sometimes result in being charged by both the new supplier and the old supplier or administrator at the same time.

Suppliers have confirmed that this is only caused by setting up direct debit with the new supplier and should not occur if it is set up automatically by the new supplier. Ofgem has confirmed that the previous supplier or appointed administrator should not charge direct debits when direct debit payments are made to a new supplier.

How do I know if I am being charged twice for energy?
Review recent bank statements and check if you have been billed twice for energy. You should account for any payments towards the old supplier to settle your final bill.

What should I do if I am charged by two suppliers?
Firstly, you should cancel any payments you are making to the old supplier. Ofgem has confirmed that their safety net will allow customers to receive any credit they are owed from the old supplier or administrator. You should contact the new supplier and explain the situation. They should arrange for any payments made to the old supplier to be returned to you. This requires them getting in contact with the old supplier and may take several months to complete.

A faster way to get money back from an old supplier is to use the Direct Debit Guarantee Scheme. This will ensure that a full refund is received without delay if any errors have been made. This can be done by contacting your bank or building society.