Research has shown that the cap has saved families on
default energy tariffs around £75 to £100 on dual fuel
bills this year. This comes as the government pledges
to build on the success of the price cap and do more to
lower energy bills including by investing £9.2 billion
in the energy efficiency of homes, schools and
hospitals and giving the Competition and Markets
Authority (CMA)
enhanced powers to tackle consumer rip-offs and bad
business practices.
However, with around 60 suppliers now competing in the
retail energy market, consumers who switch can still
make the biggest savings. Around 4.4 million
electricity customers switched supplier in the 9 months
to September 2019. Around 3.6 million gas customers
switched. Typical households would have saved an
average of around £290 on their bills if moving to one
of the cheapest deals.
In order to shield those least likely to shop around –
including the elderly and most vulnerable – from being
charged extra on their dual fuel bills the government
introduced the energy price cap on 1 January 2019.
Minister of State for Business, Energy and Clean
Growth, , said:
Our bold action to ensure all consumers pay a fair
price for their energy is making a real difference to
the budgets of up to 11 million households and
driving increased competition and innovation in the
market which will help keep bills down.
Record numbers of customers have also decided to
switch suppliers this year saving themselves an
average of around £290 on their bills.
Chief Executive of Ofgem Dermot
Nolan said:
The price caps give consumers who are on default
deals peace of mind that they pay a fair price for
their energy. Ofgem set
the cap at a level which required suppliers to cut
energy bills by around £1 billion.
Consumers can save more money this winter by shopping
around for a better deal. While the cap remains in
place, Ofgem will
continue to work with government and industry to put
in place reforms to get the energy market working for
more consumers.
Notes to editors
Research by the Competition and Markets Authority has
shown that consumers had been overpaying the ‘Big Six’
energy companies some £1.4 billion a year.
The price cap, continuing through 2020, is set by
energy watchdog Ofgem,
which review it every 6 months to reflect changes in
the cost of supplying energy. This ensures those who do
not shop around, often elderly and low-income
households, are protected from paying over the odds.
The latest ceiling was set by Ofgem at
£1,179 per year for a typical dual fuel bill paid by
direct debit.
