Everything you need to know about the energy price cap change

Energy regulator Ofgem is expected to announce a rise in the energy price cap this week amid soaring global gas prices.

Many households across the country have been told to brace for soaring energy prices in October - when the price cap rise will take effect - as they struggle to cope with the rising cost of living crisis.

Here's a breakdown of how the new energy price cap announcement will affect you and the cost of your bills.

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The price cap is determined by the energy regulator Ofgem and enforces the maximum price an energy company can charge households on a standard variable tariff for each unit of energy they use - known as kilowatt hour. Previously, variable tariffs were more expensive than fixed-rate deals with a lot of people staying on these tariffs if they never switched supplies, had their fixed-term end or their supplier had gone out of business.

It is believed that around 23 million households in the UK have their domestic energy bill decided by Ofgem's price cap. A price cap is also decided for customers on prepayment meters which are separated from those with variable tariffs.

For standard energy bills, the price cap is controlled by the maximum standing charge and price per kWh of gas and electricity that your supplier can charge you.

nitially, the price cap that was introduced by Ofgem in 2019 only changed twice a year - once in April for the summer period and once in October. Now, Ofgem will update the price cap quarterly because the market has been moving so erratically.

Ofgem will announce the price cap change on Friday, August 26. Meanwhile, the changed price will come