Energy Price Guarantee

The price cap limits the amount energy suppliers can charge customers for gas and electricity. The cap is set by Ofgem (the energy regulator) and determined by the price of wholesale energy. It’s reviewed 4 times a year, with changes coming into effect in January, April, July and October.

The Energy Bills Support Scheme was a separate government discount. This came to £400 in total, with monthly payments spread between October 2022 and March 2023. This scheme has now ended, but other support is still available.

No, the Energy Price Guarantee is a limit that is applied to the unit rate – that’s the cost you pay per unit of electricity or gas.

The standing charge is a fixed daily charge that goes towards the cost of supplying energy to your home. It includes the cost of the pipes, power lines and maintaining your meters. You pay your standing charge no matter how much energy you use.

Wholesale prices are starting to come down. But the costs of using the energy supply network are going up.

The standing charge remains at the level set out by the most recent price cap. If this changes again in the future, we'll let you know.

On 27 February, Ofgem (the energy regulator) announced they’re lowering the price cap to £3,280 from 1 April 2023.

The Energy Price Guarantee will keep the cost of a typical household energy bill at £2,500.

However, if you're on the standard variable rate, the gas and electricity standing charge could change on 1 April. This is due to the way in which the price cap and Energy Price Guarantee are applied.

We’ve written to everyone on fixed tariffs to explain the options.

Our priority is to ensure that everyone’s on the best rates possible and nobody’s losing out.

If this changes, we’ll get in touch with everyone affected.

No, we’re not offering any new fixed deals at the moment.

We are reviewing this, so please keep checking our website to see what’s available.

This is because of the complicated way energy markets work in the UK.

The energy grid gets power from renewable sources like wind, but there isn’t always enough supply. The grid often has to be topped up by electricity generated from burning gas.

This expensive gas-powered electricity then sets the price for all the electricity on the grid at that time – including renewable power.

Even if you have a renewable energy plan or only use electricity, the price of your energy will still be linked to the price of gas.

This isn’t ideal, so we’re working with the government to find a better long-term solution.

Yes. The Energy Price Guarantee applies to all customers, including those who took a fixed plan before 1 October 2022. It applies to the price you pay per unit of energy – your ‘unit rate’.

We wrote to all of our customers to let them know that the plan or rate they were paying changed.

If you're currently on a fixed plan that's priced below the Energy Price Guarantee your rates won’t have changed.

This is because the price you pay for your energy is already lower than the Energy Price Guarantee.

At the end of your fixed plan, you’ll move onto our Standard Variable Tariff, where the Energy Price Guarantee rates will apply.

If you’re on a fixed plan where prices for a typical household were between £2,500 and £3,500 per year, your rates were automatically discounted from 1 October in line with the Energy Price Guarantee.

We’ll let you know soon if you’re affected by April’s price cap.

The Energy Price Guarantee has been designed to keep the cap lower than it would otherwise be. If you use more than a typical household, you may not save this much.

What you save will depend on a few things, including:

• Your energy plan
• How much energy your home uses
• How well insulated your home is

If you’re still struggling, there are lots of ways we can support you, so please contact us.

No, you do not need to pay this money back.

The Energy Price Guarantee is applied directly to the unit rates of the tariff. Whoever is named on the account will benefit from this.

A landlord should pass on the discount irrespective of how an occupant pays for their energy use.

Here are some other tips to help you save energy and money this winter:

Reduce your home’s energy loss

If you can, add insulation like a hot water cylinder jacket to your hot water tank, or reflector panels behind your radiators.

Reduce unnecessary energy use

See tips on how to:

• Check your boiler pressure
• Turn your boiler’s flow temperature down
• Bleed your radiators

You can also check the Energy Saving Trust’s guides to saving energy at home.

Keep track of your energy use

Smart meters measure how much energy you use, then share this info with you via your online account and on an In-Home Display (IHD). Unlike a traditional meter, you can see how much energy you’re using in real time on the IHD.

This can help you make small changes to reduce how much energy your home uses and cut your bills. To find out if you’re eligible, use our smart meter appointment tool.

Our priority right now is making sure you have as much support as possible through this challenging period. 

We launched our £50m Customer Support Package in October 2022, which has already helped tens of thousands of customers with a real and immediate need this winter.

We’re working closely with StepChange, the debt charity, to support customers who need to closely assess their finances and may require help in challenging situations. That’s why we donated £2 million to StepChange to help them continue the vital support they provide.  

We’ve also formed a new charity partnership with the Trussell Trust to support their network of food banks to meet increased need this winter.

If you’re concerned about topping up or paying your energy bill, contact us as soon as possible. 

We’re here to help, and our teams will be able to talk you through your options and advise on what might work best for you.

We’ve supported lots of people in similar situations – and we can support you too. The sooner you speak to us, the easier it will be to talk you through what support and advice is available

Let us know if:

• Your financial circumstances have changed
• You’re elderly, have a disability or long-term illness

We’re here to work with you to make a suitable plan, and talk to you about organisations that can also help.

If you’re worried about your energy bills, please contact us.

If your Direct Debit payments need to change, we will get in touch to let you know.

If your Direct Debit payments need to change, we’ll be in touch with you directly.

Your Direct Debit is calculated by using past energy use as a guide. We take this amount (or an estimate, if you’re new to OVO) and multiply it by the cost of energy. 

We add the cost of your standing charge (this is like line rental for broadband), and any add-ons. If you have any credit or debt on your energy account already, we also factor this into the total. 

And then divide that total by 12, so you have a 'cost per month'. This cost per month is your Direct Debit amount. The reason we divide it by 12 is so that you can pay the same for your energy all year round – even though you might use more in the winter, and less in the summer. 

Here’s how this might work in practice:

• Say you use 1,000 units of energy over the year and this energy is charged at £1 per unit (that’s just an example to make the maths easy).
• Your energy costs for the year would be £1,000. 
• And say your standing charge cost is £100. 
• That means you have a total of £1,100 to pay over 12 months.
• But if you already have £100 credit in your account – that’s £100 less to pay.
• So overall you need to pay £1,000 over 12 months. Which works out at £83.33 each month. 
• So your Direct Debit would be £83.33.

If you start using less or more energy at any time during the year, then your Direct Debit would change to factor that in. This process is called a ‘Direct Debit Review’. 

Our aim is that you’ll always end each 12-month period (or your fixed plan, if you’re on one) with a balance of £0. This avoids you having to pay a lump sum unexpectedly.

We believe it’s really important that this information is accessible. It's your money, so we want to be as clear as possible about how we set Direct Debits and what you're paying for. 

We’re currently working closely with MoneySavingExpert and a wider team of energy suppliers and charities to make sure all energy providers are transparent about how we calculate Direct Debits.

We run a Direct Debit check-in on all accounts to make sure payments match the energy being used. We run them regularly, even for those with a positive balance. This helps ensure that you don’t finish the 12-month Direct Debit period with a negative balance that can impact your household budget.

There may be situations where the rising prices, and the fact that you'll use more energy in the winter, mean that you need to increase your payments to avoid a sharp price rise later in the year.

We know many of our customers will have a positive balance at the moment due to the summer months.

We might need to adjust the Direct Debit amount to reflect your current use while you might have a positive balance on your account.

The positive balance will be used to smooth out your bills during part of the year when you use more energy. This positive balance helps you be less exposed to future price increases.

Yes, if you're on a variable plan then you’ll pay less if you pay by Direct Debit.

We estimate our average customer will save £129 a year by choosing Direct Debit.

Paying a monthly Direct Debit amount also means you don’t have to spend time paying your bills every month. And it helps to split the cost of your energy bills into equal payments throughout the year.

If you’re concerned about topping up or paying your energy bill, contact us as soon as possible. 

We’re here to help, and our teams will be able to talk you through your options and advise on what might work best for you.

We’ve supported lots of people in similar situations – and we can support you too. The sooner you speak to us the easier it will be to talk you through what support and advice is available.

Let us know if:

• Your financial circumstances have changed
• You’re elderly, have a disability or long-term illness

We’re here to work with you to make a suitable plan, and talk to you about organisations that can also help.

If you’re worried about your energy bills, please contact us.

We work with a number of charities and organisations that offer free support.

Citizens Advice

• Citizens Advice England and Wales
• Citizens Advice Scotland
• Adviceline (England): 0800 144 8848
• Adviceline (Wales): 0800 702 2020
• Adviceline (Scotland): 0800 028 1456

National Debtline

• National Debtline
• Helpline: 0808 808 4000

StepChange Debt Charity

• StepChange
• Debt helpline: 0800 138 1111

Civil Legal Advice

• Check if you can get legal aid
• Telephone: 0845 345 4 345

Here are trusted organisations you can contact for more energy-saving advice and tips: 

• Energy Saving Trust
• Citizens Advice
• Citizens Advice Scotland
• Advice Direct Scotland