Home Business News Ofgem could raise the energy price cap to help companies retrieve £3 billion in debt

Ofgem could raise the energy price cap to help companies retrieve £3 billion in debt

by LLB Finance Reporter
15th Dec 23 11:17 am

Ofgem have revealed that from April 2024 they will lift the energy price cap to help suppliers recover almost £3 billion in debts from customers.

The energy firms will use the extra funding to support customer who are struggling to pay off their debts, however customers who are on pre-payment meter will not be affected.

Between April 2024 and March 2025 Ofgem are proposing a one-off adjustment of the price cap of £16 which is £1.33 a month.

Due to the cost of living crisis energy debt has hit almost £3 billion, which is the highest level ever, according to Ofgem.

Tim Jarvis, director general for markets at Ofgem, said: “The proposals set out today are not something we take lightly. However, we feel that they are necessary to address this issue.

“This approach will ensure the costs are recovered fairly, without penalising a particular group of customers.

“The price cap has helped to protect consumers from a volatile gas market.

“However, it remains a blunt instrument in a changing energy sector and the way it works may need to change in the future, so customers continue to be protected.”

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