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With bill hikes looming, a £10 monthly rise could put over a quarter of customers into debt

With bill hikes looming, a £10 monthly rise could put over a quarter of customers into debt

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With days before the announcement of the new level of Ofgem’s price cap, which is expected to rise by around £150, a Uswitch survey of energy customers has revealed that over a quarter could be forced into debt if their energy bills increase by more than £10 a month.

The price cap affects customers on standard variable tariffs and prepayment meters, and is updated twice a year with a new rate that limits the amount that energy companies can charge those customers. Due to various factors including rocketing wholesale energy prices, it is likely that the August 2021 price cap announcement will see the cap rise to its highest ever level, exceeding the record of £1,254 per annum.

This will come as worrying news to customers - almost a fifth of households say they have struggled to pay for their energy over the past 12 months, and one in ten households say they could not cope with any increase in bills.

Justina Miltienyte, energy policy expert at Uswitch.com, said: “Many households are already in a financially precarious position and it is worrying that an increase of £10 per month in energy bills could push a quarter of households into debt.

“Unfortunately those very circumstances are likely to arise this week as Ofgem announces the increase in the default tariff price cap.

“People on SVTs will be directly affected by any increase in the price cap but it is possible to get protection from this market volatility and reduce your bills.

“It only takes a matter of minutes to switch to a cheaper energy deal, and it will help you save money.”

There is help available for those struggling to pay their energy bills - take a look at our guide here.

You can also see the cheapest deals available to switch to through Uswitch in the table below.

Supplier Plan name Price

Based on average bill sizes for a medium energy user on a dual fuel plan paying by monthly direct debit, and averaged across all regions. This information is updated hourly with energy plans which are available to switch to through Uswitch. To appear in this table, plans must be available in at least 7 of the 14 regions.

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