Electricity and gas bills will rise considerably next month following the price cap announcement from Ofgem. The energy regulator has said that the energy price cap will rise by a record-breaking 54% which will come into effect on April 1.
The energy price cap, which is the maximum amount a utility company can charge an average customer for their gas and electricity bills, will rise from £1,277 to £1,971 for a typical household. Bills are expected to be much higher than this though following the Russian invasion of Ukraine, with wholesale gas prices increasing 40% on the day of the invasion.
The amount that energy bills will increase by will depend on how much Brits use. Prepayment customers are expected to be worse off though, with a jump of £708 from £1,309 to £2,017.
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Households across the country will be receiving correspondence from their energy companies this month, ahead of the price rise in April, which will set out renewal offers on tariffs should they choose to stay with that particular company. Financial experts, including the man behind Money Saving Expert, Martin Lewis, is urging Brits to do these three things before their energy prices skyrocket, read more about this here.
The hike in energy bills is due to a global pressure on energy supplies causing wholesale prices to rise significantly above the current price cap. This increase has been influenced by an increase in global demand for energy and exacerbated by a decreased gas supply coming from Russia into Europe, following Russia's invasion of Ukraine.
So what does this all mean if you're a customer with SSE? SSE, which is also part of the OVO family, supplies energy, phone and broadband to UK homes as well as boiler cover and they are one of the big six energy suppliers in the UK currently. We've compiled a handy guide below on what the energy crisis will mean if you are with SSE.
What does this mean for SSE customers?
SSE will be increasing the prices in its standard variable tariff and pay as you go tariffs on April 1, in line with Ofgem's price cap increase. The company has already sent out letters and emails to customers whose tariffs will be impacted, which outline how the changes will affect their bills.
The letter includes new energy prices, along with a personalised projection of future bills based on exact or estimated energy use. SSE say they are aiming for all customers to be notified of their new prices by March 12.
Pay-as-you-go customers
For pay as you go customers, the prices will be updated on your meter depends on the type you have. If you have a smart meter, then you do not have to do anything. SSE will update your prices automatically when they change. For those on a traditional meter, prices will be updated the minute you top up with your electricity key or gas card on or after April 1.
Will my direct debit need to change?
SSE will get in touch if your direct debit needs to change and will ask you to increase it if it looks like your direct debit won't cover your energy usage. Your direct debit is based on your energy prices and how much energy SSE thinks you will use by looking at your past usage.
SSE will always put aside credit on your account, usually about the cost of one month's energy. This account helps with any changes in usage and costs over time. Any remaining credit of £5 or more will be automatically refunded through your direct debit at your next review, providing it is based on an actual meter reading.
Will any SSE customers not be impacted by the price cap?
SSE customers who are on a fixed-rate tariff will not be affected by the price cap increase. However, if you are coming to the end of your fixed-rate tariff, then you will be. This is because you will automatically be moved to SSE's variable tariff if you don't fix your prices again.
SSE have told customers that they will be in touch about their options and will give them all of the information they need to decide what's right for them.
What if you only buy electricity from SSE?
Many customers who only buy their electricity from SSE have already seen this go up, which is due to the fact that wholesale gas is also used to generate a lot of electricity. Since the price of wholesale gas has increased, this has meant that electricity is also more expensive to produce and has pushed electricity bills up too.
Unfortunately if you only buy electricity you will still see an increase, although it may not be as expensive to those who both have gas and electric households.
What advice have SSE given customers to help them manage their energy costs?
- Pay by direct debit - the price cap rates for direct debit payments are less expensive than that for on demand payments (for example, where you pay your bills by cheque).
- Send regular meter readings - without regular meter readings, SSE have to estimate your bills, potentially leaving you paying too much for your energy. If you have a traditional meter, you can submit your meter readings to SSE online.
- Get a smart meter - smart meters send regular meter readings to SSE, meaning they always know exactly how much energy you use. They can also help you to keep track of your energy usage in real time. To get an SSE smart meter installed, you can book a free appointment.
- Look out for fixed energy tariffs - fixed tariffs are popular with many of SSE's customers, so take a look online to see what your options are. SSE will also tell customers on their bills if they could switch to a cheaper tariff.
SSE and OVO - how will the price cap impact customers moving over?
SSE Energy Services became part of the OVO family in January 2020, and have confirmed that all SSE customers will gradually be moving over to OVO Energy. For customers who are about to move to OVO, your prices should remain exactly the same as they would be with SSE.
If you are on a variable tariff, your prices will be exactly the same, and if you had an SSE fixed-rate tariff, you will be on the same tariff with OVO with the same prices and terms and conditions.
As with SSE, the price cap increase will impact OVO members who are on variable plans, and they will update customers on how these changes will affect them over the coming weeks.
