Millions of households are facing another increase in energy bills starting today, with experts cautioning that expenses will remain elevated throughout the upcoming winter season.

The Ofgem price cap is set to rise by approximately 13% due to heightened wholesale costs triggered by the conflict in the Middle East. For an average household paying through direct debit, the price cap will climb from £1,641 to £1,862 annually.

Although termed a price cap, it does not impose a limit on the total gas and electricity costs. Instead, it restricts the charges for unit rates and standing fees, while the overall energy bill is still heavily influenced by actual energy consumption.

Ofgem has adjusted its methodology to reflect reduced energy usage as a means to save money. Based on these revised estimates, the April price cap would have been £1,477, whereas the new July cap stands at £1,663 per year.

Households on variable energy tariffs, not locked into fixed deals, fall under the price cap protection. Uswitch advises exploring available fixed tariffs that may offer savings surpassing the price cap, emphasizing the importance of comparisons to potentially reduce costs.

Fixed energy deals secure set prices for unit rates and standing charges over a specific duration. Ben Gallizzi from Uswitch.com highlights the significance of personalized energy usage comparisons to counter the rising price cap.

Which? energy editor, Emily Seymour, recommends seeking tariffs cheaper than the price cap, limited to not more than 12 months, and free from high exit fees to avoid potential extra costs for early contract termination.

The current price cap will be effective until October, with expectations from Cornwall Insight projecting a typical household’s bill to reach £1,849 by then. The forecasted increase coincides with the onset of cooler temperatures requiring increased heating usage.

Dr. Craig Lowrey from Cornwall Insight notes that despite a temporary respite from the Iran ceasefire, energy markets remain uncertain, emphasizing the lasting impact on energy prices from ongoing geopolitical tensions.

He underlines the upcoming challenges as households transition from summer to fall, facing both increased energy usage and geopolitical uncertainties. Ofgem is set to release the October price cap details by August 26.