Millions of people will see their energy bills rise again this winter after Ofgem announced its new price cap.
The price cap is rising by 1.2% from January 1 – meaning that the average dual fuel household paying by direct debit will see their annual bill go up from £1,717 a year to £1,738 – an increase of £21.
The rise will come into effect during the coldest months and at a time when millions of pensioners have been stripped of their Winter Fuel Payment, worth up to £300.
The price cap for someone paying by pre-payment meter is rising from £1,669 a year to £1,690, while for someone paying on receipt of bill, the figure is going up from £1,829 a year to £1,851.
Tim Jarvis, director general of markets at Ofgem, said: “While today’s change means the cap has remained relatively stable, we understand that the cost of energy remains a challenge for too many households.”
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Mr Jarvis added: “However, with more tariffs coming into the market, there are ways for customers to bring their bill down so please shop around and look at all the options.
“Our reliance on volatile international markets – which are affected by factors such as events in Russia and the Middle East – means the cost of energy will continue to fluctuate.
“So it’s more important than ever to stay focused on building a renewable, home-grown energy system to bring costs down and give households stability.
This comes as bills for utilities, council tax and train travel are set to be raised above the rate of inflation with experts warning this will put a strain on the government to do more about high living costs.
Inflation, currently at 1.7%, is expected to go up with experts predicting it will go above the Bank of England’s 2% target. Some suggest it could go up to 3% next year once Donald Trump is inaugurated as president of the USA.
Household bills could hike by £278. The council tax cap of 5% will remain in place in 2025, meaning local authorities could raise bills by an average of £109 for a band D property.
Yearly, water bills by £19, broadband by £23 and annual rail season tickets by £115 or more, according to the i newspaper. Mortgage holders coming off low interest fixed deals next year will also face higher bills.