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April 2023 Price Cap Predictions

As we approach the end of Q1 many of us are reviewing our energy useage, for example ditching certain home electrcials such as Tumble Dryers and reconfiguing our home heating systems to reflect the milder weather.

Over the winter months customers have benifited from the £400 Energy Bills Support Scheme however in March 2023 this scheme will come to an end and in April a brand new Energy Price Cap will be introduced.

So what does this mean? Well, customers are currently protected by the Energy Price Guarantee which will limit a typlical households enegery bill to £2,500, rising to £3,000 in April, should it increase as planned.

Cornwall Insight has released the final prediction for the April Default Price Cap, predicting the cap for a typical household to be £3,294 equivalent per year. Ofgem will announce the cap on 27 February.

The forecasted predictions, from industry trusted market research agency, indicate that even with the rise in the level of EPG, the figure will remain lower than the April Price Cap, leaving the governement to pay the difference to the energy suppliers. The estimated cost would be £26.8bn (compared to £29.4bn should the EPG remain at £2,500).

Looking further ahead in the year, Cornwall Insigts predict that the differnece between the two schemes will eventually reduce, and should this happen as predicted the govnernement will effectively uncur no costs for the EPG scheme during this period.

Figure 1: Cornwall Insight’s Default tariff cap forecasts

Figure 2: Default Tariff Price cap forecasts, Per Unit Cost and Standing Charge including VAT (dual fuel, direct debit customer, national average figures)

While prices under the cap remain considerably higher than historic norms, the combination of falling wholesale prices and an increase in the EPG could see the return of competitive tariffs, and with it the chance for consumers to take back some control over their energy.

Many of our customers have taken the uncertainty of the energy market into thier own hands and become more self sufficient in comaprision to being wholly reliant on the big 6 providers and fossil fuels in general.

The current Boiler Upgrade Scheme is the perfect spring board into running a more energy efficeint home. Contratry to the name, you do not need to be replacing a boiler, and you can even be a self build new home, as long as you are leaving behind fossil fuels for a renewable solution, you will be eligible for the grant.

To find out more about making the most of the BUS contact us today for a no obligation chat, where we will be able to give you cost predicitons on what your property could save being heated by an Air Source Heat Pump or Ground Source Heat Pump.


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