The Energy Price Guarantee is set to increase. (Picture: Getty Images)
Energy bills have been a critical driver of the cost of living crisis, with some households facing significant rises in the price of heating their homes, particularly over winter.
In response, then Prime Minister Liz Truss announced in October 2022 that the government would introduce the Energy Price Guarantee – which meant a typical UK household would pay up to an average of £2,500 a year in a bid to save consumers an average of £1000 annually.
In March 2023 scheme was extended for three months by Chancellor Jeremy Hunt in his Spring Budget, saying, ‘High energy bills are one of the biggest worries for families, which is why we’re maintaining the Energy Price Guarantee at its current level.’
However, with the EPG’s end-of-June deadline now rapidly approaching, many families will be concerned about what could happen to their energy bills.
Here is what you need to know.
Will energy bills increase in July 2023?
The first thing to keep in mind is that the Energy Price Guarantee is not ending in July 2023 – but the figure is increasing by 20%.
That means that the Energy Price Guarantee will now be fixed at £3,000 rather than £2,500.
In theory, that means that energy bills could increase. However, that is widely expected not to be the case.
In fact, many experts predict that energy bills will decrease from July.
Good news could be on its way for energy consumers. (Picture: Getty Images/iStockphoto)
This is because the new Ofgem Price Cap will be ahead of July’s EPG, and it is expected to be much lower than that of the EPG, and customers will pay whichever is cheaper.
The financial guru behind Money Saving Expert Martin Lewis predicted a drop of 17.5% when the OPC comes into effect and spoke to Neil Kenward, energy regulator Ofgem’s director for strategy and decarbonisation, on This Morning.
When pressed to provide a figure, the Ofgem exec wouldn’t comment on a specific number, describing the information as ‘sensitive’ until its publication date next Thursday, going on to say Ofgem ‘haven’t actually finalised the number.’
However, Mr Kenward did say: ‘I can be clear that the number will be down considerably on the £2,500 limit that applies at the moment for that average annual bill.’
The news will be welcomed by all who have been struggling with the energy costs this year.
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What is going to happen to energy bills from July?
