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Energy bills could go up before October price cap rise | Energy bills could go up before October price cap rise |
(32 minutes later) | |
Energy bills could increase ahead of the expected rise in October, the UK's energy regulator has revealed. | Energy bills could increase ahead of the expected rise in October, the UK's energy regulator has revealed. |
Ofgem and industry body Energy UK said it was "possible" for suppliers to raise customers' direct debits before the new cap on energy prices kicks in. | Ofgem and industry body Energy UK said it was "possible" for suppliers to raise customers' direct debits before the new cap on energy prices kicks in. |
But British Gas told the BBC it wouldn't put up prices before October. | |
Households are braced for sharp rises in energy bills over the winter, with warnings that the average bill could reach as high as £4,200 next year. | |
Ofgem said direct debits are usually charged in a way so that customers build up "credit" during the warmer summer months when usage is lower, to spread out the cost of using more energy in the colder months. | |
"It's therefore possible for direct debits to increase ahead of a price cap rise or even when a customer's use has remained constant," an Ofgem spokesperson said. | |
However, Ofgem said customers can ask for their excess credit to be "returned at any time and can contact their suppliers to change how their direct debit is spread." | |
"For example, they pay for exactly what they used in that month and do not build up a credit ahead of winter," Ofgem said. | |
A new price cap- determining the maximum suppliers can charge customers for energy usage in England, Scotland and Wales - is due to be announced at the end of this month, but will come into effect in October. | |
Consultants Cornwall Insights expects this to rise to £3,582 a year, due to the ongoing war in Ukraine pushing up global wholesale gas prices, and have warned of further rises over the winter. | |
Ofgem said protecting consumers was its "top priority", adding "suppliers must ensure that direct debit payments are based on the best and most current information available to them". |