Energy bill to be capped quarterly – regulator

The energy price cap will be updated quarterly, rather than every six months, says industry regulator Ofgem.

Ofgem also warned that customers face a "very challenging winter ahead" but that the change would go "some way” to providing the stability needed in the energy market.

It said Russia's actions in Ukraine had led to volatility in the global energy market and, as a result, the price cap would have to increase later this month to reflect increased costs.

However, it said that the changes would mean that any fall in wholesale prices would be passed on in full to customers and more quickly with the quarterly price cap.

Ofgem chief executive Jonathan Brearley said: "I know this situation is deeply worrying for many people.

"As a result of Russia's actions, the volatility in the energy markets we experienced last winter has lasted much longer, with much higher prices than ever before. And that means the cost of supplying electricity and gas to homes has increased considerably.

"Today's changes ensure the price cap does its job, making sure customers are only paying the real cost of their energy, but also, that it can adapt to the current volatile market.”

Changes to the price cap come as household energy bills are likely to remain at more than two-and-a-half times their pre-crisis levels until at least 2024, according to the latest predictions.

In May, the Government announced an energy costs support package - worth £400 per household - in response to predictions that bills would rise to £2,800 for the average household in October.