One area of Wales will soon have the highest costs of electricity in the UK as prices rise. Data shared by Ofgem, the government's gas and electricity regulator has shown how much prices will vary across the country from October 1 when household bills increase again.
The data provided by Ofgem to North Wales Live shows that households in north Wales and Merseyside will pay the highest rate of electricity per kilowatt-hour at 34.3p respectively. The rate differs hugely across the UK with some areas paying as low as 30.7p in comparison. These figures are based on the average consumer use paid by direct debit on "duel fuel" which is used by the majority of UK households.
From this week, October 1, energy prices are set to rise for millions of households as a new energy price guarantee is introduced. The price guarantee was introduced by the UK Government in an attempt to tackle the cost of living crisis, as a result the typical household's energy bills will be capped at £2,500 a year.
Read more: Everything you need to know ahead of energy price rise this week
This has been brought in to replace the price cap, which was set to rise to £3,549. However, people will still be paying around 95% more on their energy bills this winter than last year. Despite the new guarantee, the amount people in different areas across the UK will pay will still differ significantly.
Here is how the energy costs will vary for Direct Debit customers by area:
Breakdown of rates for Direct Debit customer (ex VAT) |
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| Charge Restriction Region | Dual Fuel cap levels at typical consumption (£/Cust/year) | Implied Unit Rate for GAS (p/kWh) | Implied Unit Rate for Electricity (p/kWh) |
| North West | 2,354 | 9.8 | 31.9 |
| Northern | 2,329 | 9.7 | 30.7 |
| Yorkshire | 2,354 | 9.8 | 31.5 |
| Northern Scotland | 2,364 | 9.8 | 31.5 |
| Southern | 2,394 | 10.0 | 32.6 |
| Southern Scotland | 2,382 | 9.8 | 32.2 |
| N Wales and Mersey | 2,444 | 9.9 | 34.3 |
| London | 2,404 | 10.0 | 34.1 |
| South East | 2,399 | 9.8 | 33.6 |
| Eastern | 2,381 | 9.8 | 33.4 |
| East Midlands | 2,340 | 9.7 | 31.4 |
| Midlands | 2,382 | 9.8 | 32.1 |
| Southern Western | 2,409 | 9.9 | 32.2 |
| South Wales | 2,396 | 9.9 | 32.4 |
| GB average | 2,381 | 9.8 | 32.4 |
| GB average, inc VAT (at 5%) | 2,500 |
Why energy prices differ in parts of the UK?
Energy prices fluctuate across the UK for a number of reasons, namely; how much energy suppliers are able to sell to customers in a particular region, how many energy suppliers purchase from the national grid in that region, and the competition among energy distributors for the region.
The way energy is supplied also has an impact on the cost in each region. Electricity is supplied through Distribution Network Operators and energy suppliers across 14 geographical regions. Prices across these regions will be set by the Networks with regulations in place by Ofgem to prevent DNO's charging suppliers too much.
Gas is supplied by eight Gas Distribution Networks which are also regulated by Ofgem. However, there are still different charges for suppliers in these areas meaning households on the same energy deal could still get different prices.
The differing prices per region can also be a result of the way the energy has been generated. For example, in areas where there is a larger supply of oil or gas - such as where fracking has taken place - then these areas will be cheaper. The amount of energy that is produced through renewable means also drives cost down due to the impact of solar of wind farms.
Therefore, the cost in each region varies partly due to the amount of energy they are able to produce and through what means - and how much producing this energy costs. Supply and demand don't have too much impact on costs because in some regions there will be enough customers but not enough energy being produced cheaply which will impact the cost of the supply.
An Ofgem spokesperson told NorthWalesLive: “Consumers do benefit from the energy that local generators produce, but the charges paid by consumers in each local area differ based on the costs of building and maintaining the electricity network. Some of these costs are driven by the networks needed to transport electricity from power stations to homes and businesses, but some are driven by how much power is consumed during peak periods, like winter evenings.
“Any changes to network charges need to be compared against a wide range of criteria. We carefully assess each proposal, and have already reviewed the idea of a national network charge and found it did not better serve the interests of UK consumers. A link to the results of this can be found here”.
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