Martin Lewis reveals key date bills will be slashed amid new Energy Price Cap

What is the energy price cap? 

The price cap on energy bills was introduced in January 2019 as a way to prevent households being ripped off by their energy suppliers.

It is currently £3,280 a year on average.

But households only pay £2,500 a year on average, as the price is overruled by the energy price guarantee, which is cheaper.

However, this will fall to £2,074 from July when the price guarantee finishes and the energy price cap comes into force.

Because the price cap changes every three months, it means prices could go up or down from October.

It affects around 29million customers on default or variable tariffs, according to the regulator Ofgem.

The cap is calculated based on the wholesale price of gas and electricity.

It also includes allowances for tax, charges paid to the energy networks, green levies and social payments.

The reason it has gone up so much in the last 18 months is partly due to Russia limiting its gas supply to Europe.

But there’s also been high demand from Asia which has seen prices surge.

The UK also imports more than two-thirds of its gas which is subject to global price swings making prices more volatile and likely to rise.

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