The energy price cap will go up by £693 to £1,971 from April, although the government is expected to pledge support for millions of households struggling to manage rising costs.

The price cap, which was introduced by the energy regulator Ofgem in 2018, limits what a supplier can charge on their standard variable, or default, tariff. The cap is based on the price per kWh of electricity and gas that can be charged. It isn’t, however, a limit on total bills, as these depend on usage, so those who live in large properties or who consume a large amount of energy could well see annual bills much higher than £1,971. You can find out more about the price cap in our guide What is the energy price cap?

Jonathan Brearley, chief executive of Ofgem said: “We know that this rise will be extremely worrying for many people, especially those who are struggling to make ends meet, and Ofgem will ensure energy customers support their customers in any way they can.

“The energy market has faced a huge challenge due to the unprecedented increase in global gas prices, a once in a 30-year event, and Ofgem’s role as energy regulator is to ensure that, under the price cap, energy companies can only charge a fair price based on the true cost of supplying energy and gas.”

The latest cap will affect around 22m UK households, who will see their energy costs rise by 54%, taking bills to their highest level since the cap was introduced.

Default tariffs are usually suppliers’ most expensive tariffs and in the past many energy customers have been able to save hundreds of pounds by switching to a cheaper fixed rate deal. However, soaring global energy costs have meant that for the past few months, suppliers have been unable to offer deals lower than the price cap. Many suppliers have ceased trading altogether due to rising wholesale costs and the cap limiting the amount they can charge customers. If your supplier has stopped trading, find out what happens next in our guide What happens if my energy supplier stops trading?

What is the government doing to help?

There are fears that the latest rise in the price cap could see as many as 6m households across the UK facing fuel poverty.

Recognising the strain higher bills will place on people, the government has announced it will offer rebates to all energy customers, which are aimed at reducing the financial pressure on households when the energy price cap rises in April. These loans must be paid back by consumers over the next five years when energy prices fall, and the cost of living crisis has eased.

The scheme will provide a £200 rebate for every household in October, with energy suppliers passing on the money from government loans. You can read more about this in our article Britons to get £200 rebate on energy bills.

The government has also promised that 80% of all homes in England will get a £150 discount off their council tax bill in April. All households in council tax bands A, B, C and D will be eligible for the rebate. Unlike the £200 loan, the council tax rebate does not have to be repaid.

What other help can I get with energy bills?

You may be eligible for a £140 discount off your energy bills under the Warm Home Discount scheme, if your supplier belongs to it and you are receiving the Guarantee Credit element of Pension Credit, or you’re on a low income and receive certain means-tested benefits.

To check which energy suppliers offer the discount, you can visit GOV.UK.

During particularly cold weather, you may be eligible for Cold Weather Payments of £25. These are made when your local temperature is recorded as (or forecast to be), an average of zero degrees celsius or below for at least seven consecutive days between 1 November and 31 March every year,

If you are already receiving any other low-income benefits (i.e. Pension Credit) then you should be eligible to receive it – and if you are, you should receive it automatically, so there’s no need to apply.

If your home is badly insulated, you might qualify for help to make improvements that will make it more energy efficient and keep you warmer.

You can use the links below to find out more about schemes that may be available to you depending on where you live:

Find out more in our guide Are you eligible for help with heating costs?

How can I reduce my energy costs?

Making a few simple changes around your home can help reduce your energy bills.

For example, according to the Energy Saving Trust, you can save around £35 a year just by remembering to turn your appliances off standby mode, whilst cutting back your washing machine use by just one cycle per week can save you £8 a year on energy.

Similarly, hanging up your wet clothes to dry rather than using a tumble dryer is an easy way to reduce your energy consumption and could save you up to £70 per year, according to Ovo Energy.

Learn more in our article Energy saving tips: how to reduce your bills.

What if I can’t pay my bills?

If you’re finding it impossible to cover your energy costs, get in touch with your supplier as soon as you can and explain that you’re having financial problems. They are obliged to give you advice on how to pay back the money you owe and should suggest a repayment plan that will still leave you enough money to live on.

Don’t worry that a missed energy bill will be followed by disconnection – it won’t.

You may be told by your energy provider that your gas and electricity supply could be disconnected if you haven’t paid a debt after 28 days of being notified. However, usually your supplier will offer a variety of options to repay your debt, rather than disconnect you, such as a repayment plan or prepayment meter.

If you’re a pensioner living alone, or a pensioner living with children under five, you cannot be disconnected between 1 October and 31 March, even if you’re in debt and unable to repay it.

You also cannot be disconnected at any time by any of the six largest suppliers (EDF, British Gas, npower, E.on, Scottish Power and SSE) if you have one of the following: long-term health problems, serious financial problems, a disability or young children at home. Smaller suppliers may also have similar criteria that means you will not be disconnected while in energy arrears.

Find out more in our guide What can you do if you can’t pay your energy bills?

Where to find advice

Working out how you’ll cover energy bills can feel overwhelming, and if you are struggling it’s a good idea to seek professional advice as soon as possible.

There are plenty of free sources of advice available and many charities and organisations can help you negotiate debt repayment plans with your creditors on your behalf. These include:

Whatever happens, don’t suffer in silence, as struggling with debts on your own can take a real toll on your mental health. If you are finding it hard to cope, our article Are money worries affecting your mental health? explains where to go for help if you need someone to talk to.

Are you worried about soaring energy costs? Do you think the government’s new measures go far enough to help? You can join the conversation on the Money section of the Community forum or leave a comment below.

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