Ofgem raises price cap as millions lose fuel payments

The energy price cap will increase in January for a second consecutive time, raising bills by 1.2 per cent as millions of people lose access to winter fuel payments.

- ALBERT TOTH, HOWARD MUSTOE

Campaigners reacted angrily to the rise in price as Britain endures sub-zero temperatures, with Age UK calling it "the latest in a series of blows” for the vulnerable.

The new figure will bring the average household energy bill to £1,738. This is £21 more than the October to December cap of £1,717. The new cap, lasting from January to March 2025, will be £190 cheaper than the cap during those months in 2024.

The energy price cap increase comes after Sir Keir Starmer ended the winter fuel payment for most pensioners as his government aims to make savings. The price cap is the maximum amount suppliers can charge for each unit of energy for those on a standard variable tariff, which includes most households. It is expressed as an annual bill for an average home.

Caroline Abrahams, charity director at Age UK, said: “Older people, struggling without their winter fuel payment, who were praying for a reduction in energy prices to help them in the new year, will be bitterly disappointed today. The news that the energy price cap is instead slightly rising is the latest in a series of blows for pensioners living on a low or modest income, who do not receive Pension Credit because they don’t claim it or are not eligible.”