Prime Minister Liz Truss announced that the average gas and electric bills would be capped at £2,500 – depending on usage – for two years to help households deal with spiralling prices.
Energy providers have urged customers to take meter readings before the cap comes into force and warned that those who don’t could be overcharged.
Here’s everything you need to know ahead energy price cap rise.
What is the energy price cap?
The energy price cap, calculated by the regulator Ofgem, is a limit on the maximum amount energy supplies can charge you for each unit of energy you use if you live in England, Scotland and Wales.
It applies if you’re on a default energy tariff, regardless of how you pay your bills and is dependent on usage. That means some households may still pay above the £2,500 average cap if they use more gas and electricity.
When does the energy price cap change?
Before October 1, the cap was set at £1,971 and was then expected to rise to over £3,500, as predicted by Ofgem.
But, it will now stay at £2,500 until 2024 – when the next general election is set to take place – after an intervention by Prime Minister Liz Truss.
How can I save money on my energy bills?
Energy suppliers recommend that customers submit gas and electricity readings before October 1, so they can calculate usage correctly.
Frazer Scott, chief executive of Energy Action Scotland, said: “This week, every household across the UK must make sure it submits a meter reading to their energy firm to avoid paying a penny more than they absolutely have to when prices go up on 1 October.”
Most energy providers will allow customers a grace period to submit their pre-October readings, which will then be backdated.
All households are also entitled to a one-off £400 cut in their bills from October, which is deducted automatically. This means you do not need to contact your supplier and the payback will be spread over six months.
If you use a traditional payment meter, however, you will be entitled to a voucher for this deduction, which can be cashed in wherever you top up your gas and electricity.
People are also being urged to contact their suppliers if they can’t pay their bills.