The energy market has been on a rollercoaster in recent years, but there’s a glimmer of good news on the horizon: the energy price cap is set to fall on 1st July 2024. Let’s break down what this means for your bills and how you can make the most of this change.

What is the Energy Price Cap?

The energy price cap, set by Ofgem, limits the maximum amount energy suppliers can charge per unit of gas and electricity. It also sets a cap on the daily standing charge. This is designed to protect consumers from exorbitant energy bills. To understand how the new price cap will impact your bill, you can use the MoneySavingExpert [invalid URL removed] ‘What you’ll pay from July’ calculator.

How Much Will Prices Fall from 1st July?

The price cap is expected to drop by an average of 7% from 1st July. This means:

  • Monthly Direct Debit: The average annual bill for a typical dual-fuel household will fall to £1,568.
  • Prepayment Meter: The average annual bill will drop to £1,522.
  • Payment on Receipt of Bill: The average annual bill will fall to £1,668.

Remember, these are just averages, and your actual bill will depend on your usage.

What are the New Unit Rates and Standing Charges?

While the overall price cap is falling, standing charges (the fixed daily amount you pay regardless of usage) will remain the same. This is a point of contention for many, as standing charges disproportionately affect those who use less energy. Ofgem is currently reviewing standing charges, and we’ll keep you updated on any developments.

Energy TypeCharge TypeNEW Energy Price Cap <br> (1 July to 30 September 2024)Current Energy Price Cap (1 April to 30 June 2024)
GasUnit rate5.48p per kilowatt hour (kWh)6.04p per kilowatt hour (kWh)
Standing charge31.41p per day31.43p per day
ElectricityUnit rate22.36p per kWh24.50p per kWh
Standing charge60.12p per day60.10p per day

Should You Fix Your Energy Tariff?

With the price cap predicted to rise again in October, some may want to consider fixing their energy tariff to lock in a lower rate. You can compare fixed deals using the MoneySavingExpert Cheap Energy Club [invalid URL removed]. As a general rule, it’s worth considering fixing if the fixed deal is priced 2% less than the current April price cap.

Keep an Eye on the Market

Ofgem is considering lifting the ban on new-customer-only deals from 1st October. This could mean more competitive deals for those willing to switch suppliers. Stay tuned for updates on this.

In Conclusion

While the falling price cap is welcome news, it’s crucial to stay informed and proactive about your energy choices. Compare tariffs, consider fixing, and keep an eye on the market for new deals.

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