The Energy Price Guarantee (EPG) caps the unit prices that domestic customers pay for their energy at rates lower than the energy regulator Ofgem's price cap. The goverment makes up the difference with your energy provider. The EPG does not affect standing charges, which are determined by Ofgem.
The government had been planning to increase the amount households had to pay by around 20% from 1 April, but Jeremy Hunt has today confirmed that prices will remain as they are until July. It's likely that the next time Ofgem changes its prices - from the 1 July - they will drop lower than the current EPG rates, so households will see a small energy price drop.
Today's U-turn comes after weeks of mounting pressure from consumer groups and charities concerned that the additional costs would push many households already in financial distress over the edge.
However, it's worth noting that the government's Energy Bill Support Scheme, or EBSS, which sees most households receive an additional £67 a month towards their energy bills, will still end at the end of March.
That means that in real terms, households will still find April's monthly bill more expensive than those you've had so far.
A 'typical' household using an average amount of energy and paying by direct debit could continue to expect to pay around £2,500 a year, or £208 a month, under the EPG. In practice, that means that each unit of electricity currenty costs an average 34p, while each unit of gas costs an average 10.3p. The more you use, the more you'll pay.
In a statement made ahead of today's Budget announcement, Chancellor Jeremy Hunt said: '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.
'With energy bills set to fall from July onwards, this temporary change will bridge the gap and ease the pressure on families, while also helping to lower inflation too.'
It's expected that the current rates of the Energy Price Guarantee (EPG) will continue to apply - but we will know more after the Chancellor's announcement this afternoon.
If you pay by direct debit and live in England, Scotland or Wales, the current average rates are:
These are the average amounts that you can be charged for a unit (or kilowatt hour). How you pay and where you live affect exactly what you pay. Your energy supplier should have told you (when the rates last changed, in October 2022) exactly what you’re paying.
Note that although EPG rates aren’t changing, the daily standing charges you pay for an electricity and/or gas connection, are going up slightly. These are based on the price cap set by energy regulator Ofgem.
From 1 April, the average standing charges will be:
These are averages across Great Britain and based on paying by direct debit. Daily rates vary by as much as 24p depending on where you live. Areas with higher standing charges usually have lower unit rates, and vice versa.
Your standing charge will also be higher if you pay when you receive your bill or have a prepayment meter.
If you're one of the estimated four million households still on a fixed tariff, your prices will stay at the rates you fixed unless they're higher than the EPG. In which case, your prices will be capped at EPG rates.
source https://www.which.co.uk/news/article/government-u-turn-on-april-energy-price-increase-and-how-it-affects-your-bills-awqB90A7VRF8