Energy price cap rises to £4,279, Ofgem announces

The price cap is set to rise to an annual level of £4,279 in January 2023, but bill-payers remain protected under the government’s Energy Price Guarantee (EPG). 

The energy price cap level indicates how much consumers on their energy supplier’s basic tariff would pay if the EPG were not in place.  

The price cap has been in place since January 2019, and it is a legislative requirement for Ofgem to regularly review the level at which it is set. It ensures an energy supplier can recoup its efficient costs, whilst making sure customers do not pay a higher amount for their energy than they should.

The price cap, as set out in law, does this by setting a maximum suppliers can charge per unit of energy.  

For the first three months of 2023, the energy price cap will increase to an annual level of £4,279 for an average dual fuel household paying by direct debit based on typical consumption, but bill-payers will still be protected by the Government’s Energy Price Guarantee until the end of March 2024, as confirmed by the Chancellor on Thursday 17 November.  

Ofgem stressed that there is no immediate action for consumers to take as a result of today’s announcement. 

Ofgem continues to protect consumers through its ongoing robust regulation of the market, taking enforcement action where necessary and providing support to those who need it the most. Earlier this week, Ofgem set out the proactive action it was taking against 17 energy suppliers to ensure that consumers are protected this winter and beyond. 
 
The next quarterly price cap update will be on 27 February 2023.