Latest forecasts predict 3% increase to April price cap

The energy price cap is expected to rise to £1,785 in April, according to the latest forecast from Cornwall Insight.

April’s price cap won’t be confirmed until February, but the 3% increase looks likely after a surge in global market prices.

This is largely down to new uncertainty over a Ukraine transit deal, higher levels of withdrawals from EU gas storage facilities and vague export plans under a second Trump presidency.

Cornwall says cap forecasts will continue to vary because of these factors, adding that changes by regulator Ofgem could also affect bills.

What changes are being made?

A scheme providing extra support credit for some prepayment customers is expected to be extended past the end of March. The ‘supplier bad debt allowance’ currently stands at around £30 a year.

Prices could also be driven up by government legislation which will compensate the industrial sectors for part of their charging costs from April 2025.

While these factors mean prices could go up, Ofgem is also looking into cost-cutting measures to reduce bills by a minimum of £10.

Will prices come down next year?

Cornwall’s expecting the July price cap to be lower than the April one, though we don’t know yet if that means it’ll be lower than the January price of £1,738 a year.

It’s important to remember though that even April’s cap could change before it’s announced next month.

What else do I need to know?

The price cap rose by £21 on 1 January, meaning someone who uses a typical amount of gas or electricity will be paying more for their energy than they were in December. It affects those on default and variable tariffs.

Ofgem has urged people to shop around for the best deal to avoid spending more than necessary.

Fixed-price deals are usually cheaper than other tariffs, though it’s worth bearing in mind that you could miss out if prices fall before your offer ends.

How can I bring my energy bills down?

Even though the price cap is around 10% lower than it was this time last year, bills are still about 50% higher than they were before the Covid-19 pandemic.

If you don’t have a smart meter, submitting a meter reading can help make sure you’re not overpaying.

Using a price comparison website like Uswitch or GoCompare can help you find significant savings.

As energy expert Elise Melville points out, the average household could save up to £148 per year just by switching to a fixed deal. So, it’s worth exploring your options.

Switching is still possible, even if you’re in debt, as long as your unpaid bill is less than 28 days old. If you're finding it hard to manage your energy costs, get in touch with your supplier.

Some firms offer grants to those who have fallen behind, or you could arrange a payment plan for what you owe.

If you’re in a vulnerable situation, see if you can join the priority services register for extra help.

Check out our guide on dealing with energy arrears for more information and our blog on where to go to get help with your energy bills.