Will prices fall after January?

It’s difficult to say whether prices will fall after January because the wholesale market is so unstable. A resolution to the war would see prices fall, but it’s not clear when or by how much. However, if there is no change in the situation in the Middle East, prices would likely stay around the January cap level or even increase further.

What should I do about the January price cap?

The price cap affects customers on standard variable tariffs. If you haven’t switched energy for more than a year, you’re almost certainly on one of these tariffs, which means your energy costs will go up in January when the price cap changes.

The easiest and quickest way to avoid these price hikes is to switch to a fixed energy deal. These usually offer savings against the price cap, but also provide price certainty for the duration of the contract because the rates won’t change, so you’ll know your expected spend. Running an energy comparison is quick and free, so it’s worth doing just to see what’s out there.

If you’re on a fixed deal, you won’t be affected by price changes until the deal ends, at which point you’ll be rolled on to your supplier’s standard variable tariff and should then see if you can switch to another fixed deal.

There are also support schemes that are run on an annual basis that can help take some pressure off energy bills, such as the Warm Home Discount, Winter Fuel Payment and Cold Weather Payment.