Your energy bills will be based on how much gas and electricity you use. However, properties vary in their energy efficiency, so two households with similar energy usage may have very different bills.
To get an idea of whether you are using energy efficiently, it is helpful to look at average gas and electricity usage figures. The government provides average energy usage figures for different types of households, so you can compare your own usage against these averages.
If your usage is significantly higher than the average, it may be worth taking steps to improve your energy efficiency. Similarly, if you are paying more for your gas and electricity than the average bill, it may be worth shopping around for a better deal. Comparing your energy usage and costs against averages can help you to save money and use energy more efficiently.
With the price of energy increasing across the UK in 2022 and into 2023, we consider it important to ensure that you have all of the up to date information on your tariff options, and what the average cost of your energy could be going forward.
How much is the average energy bill in the UK?
We all know that the cost of energy in Britain has been on a steady rise. The average household ends up paying around £1,326 every year for their power bill. This statistic is calculated via 2021 payments and the first quarter of 2022.
The UK is set to experience an increase in energy prices once 2022 figures are released. The majority of households currently pay more than the government estimate, and this trend will likely continue into next year with many people paying far above what’s announced at present time due their variable rates.
Variable rates may change after 3 months or less before they need another renewal decision made about whether stay on those plans indefinitely.
Will the price cap being put in place help me reduce my energy bills?
Since 2018, the Ofgem price cap has been in place to ensure that consumers are paying fair prices for their energy. The cap is reviewed and updated every 6 months, in line with fluctuations in the wholesale energy market.
The most recent review in October 2022 saw the biggest increase to the price cap since it was introduced, with prices rising by an average of £117/year for dual fuel customers. This is due to the increased cost of wholesale gas and electricity, which has been driven by the coronavirus pandemic and the resulting economic downturn.
Despite the increase, the price cap remains significantly lower than the un capped standard tariff prices offered by energy suppliers. As a result, the cap is definitely out there to protect households and businesses from being dramatically overcharged for their energy.
You can study the trends in the energy price cap below…
Timeline
Energy price capped at –
January – March 2019
£1,137
April – September 2019
£1,254
October 2019 – March 2020
£1,179
April – September 2020
£1,162
October 2020 – March 2021
£1,042
April – September 2021
£1,138
October 2021 – March 2022
£1,277
April – September 2022
£1,971
October – December 2022
£3,549
Following these results, OfGem have moved into reviewing the price cap twice per year in line with current market value.
For those with larger homes, it is usually expected that you will have a fuller energy bill. This is due to having more rooms to heat and more technology. You will also run up higher bills with multiple bathrooms impacting higher water usage.
Property Size
Average KwH Usage
Average Annual Cost*
Average Monthly Bill
1-2 bedroom house
Gas: 8,000 kWh/ Elec: 2,000 kWh
£1,178.16
£98.18
3-bedroom house
Gas: 12,500 kWh/ Elec: 3,000 kWh
£1,793.21
£149.43
5-bedroom house
Gas: 18,000 kWh/ Elec: 4,500 kWh
£2,623.66
£218.63
*Calculations based on the following kWh figures:
Electricity unit rate 28.34p per kWh & 45.34p daily standing charge
Gas unit rate 7.37p per kWh & 27.22p daily standing charge.
About average bills: Electricity
The cost of electricity is one of the biggest factors in determining how much a household’s energy bills will be. Domestic electricity bills in the UK vary considerably, but the average bill at the end of 2021 was £769 per year. This figure includes both standing charges and usage charges.
Standing charges are a fixed charge that covers the costs of providing electricity to a home, while usage charges are based on the amount of electricity used. Generally, households with higher electricity usage will have higher bills.
With this being an increase of £64 since 2020, it is considered to be an inflation of 5%, and shows the growing trends in the UK market price. For this reason, the energy price cap is expected to rise again in October 2022.
With a bill that’s close to the average electricity cost of £769, you should be able manage any future increases by comparing energy tariffs ahead of October.
About average bills: Gas
The average domestic gas bills at the end of 2021 was £586, an increase from the previous year by 34%.
We know too well that householders who have not yet upgraded their insulation and boiler systems may be paying a high price in the long run. With gas costs remaining volatile, it is important for homeowners to regularly compare prices so as not get caught off guard when their utility bill increases significantly or drops suddenly due to low supply, and invest in upgraded systems and insulation when you can.
Most of us are familiar with the high cost of gas, so it’s no secret that the majority of household gas costs are spent heating your home. This means that if you use more energy than your home requires to be heated then it will cost less for the rest. This is because large homes require less total power and so their prices per unit must higher relative those smaller ones – meaning someone who lives in an apartment would typically pay much lower fees even though they might have high usage patterns.
How is my energy consumption affecting my bill?
The single most important thing you can do to save on your energy bills is make sure that the power going into your home from utility companies matches up with what’s coming out. You should aim for as low a unit rate per hour as possible, as your unit rate will be determined by the amount of kilowatt hours that you use each month.
There are a number of things that can impact your energy consumption at home, so we wanted to outline some of them for your consideration.
Number of residents – The more people who are living in your home, the higher your energy usage is likely to be. This can be due to a number of factors such as cooking, heating, air conditioning, and lighting needs. If possible, try to figure out ways to conserve energy by adjusting your habits or even buying smaller appliances that use less power.
Appliances – Older appliances tend to have higher energy consumption rates than newer models, so you may want to consider upgrading or replacing older devices with new ones. Additionally, keeping appliances clean and in good repair will help them run efficiently and consume less power overall
Time of year – The time of year can also impact your energy usage. During the summer, you may want to use air conditioning to keep cool, while in the winter you might need more heating. If you have a choice, try to avoid using these appliances during peak hours when electricity costs are higher. Typically, bills are higher in the winter due to the rise in usage across the UK, and on weekends.
Behavior – Finally, your own behavior can have a big impact on how much power you use. For example, if you run appliances like ovens and microwaves all day long instead of only when needed, then this is likely to increase your overall electricity consumption substantially. Adjusting your habits by turning off lights when not in use and running dishwashers or washing machines only when full can help reduce your energy spending as well.
When shopping for appliances, it’s important to pay attention to power ratings and energy labels. This information can give you a good idea of how efficient the appliance is. In general, appliances that produce heat and have moving parts tend to use more energy than those that produce sound or light. However, there are some exceptions to this rule. For example, some dishwashers and washing machines are very efficient, even though they use a lot of water and generate heat. To make sure you’re buying an appliance that’s right for your needs, it’s important to do your research before making a purchase. Checking power ratings and energy labels is a good place to start.
How does my tariff affect my home energy bills?
One of the biggest factors that impacts your home energy bills is the type of tariff you have. There are two main types of tariffs available: Fixed rate and Variable tariffs. Fixed rate tariffs are generally more expensive, as they have a set price for an agreed period of time. It’s no surprise that this used to be the most desired energy tariff before many suppliers pulled their prices during last year’s UK power crisis.
On the other hand, variable tariffs are lower in cost, as energy providers can change the prices based on market fluctuations. This means that instead of staying the same, a variable tariff could change in cost month to month.
When deciding which tariff type is right for you, it’s important to consider your budget and usage habits. If you tend to use more energy throughout the year, a variable tariff may be preferable since it can save you money in the long run. However, if you prefer having a fixed rate and knowing exactly what your energy bills will be month-to-month, then this might be a better option for you. Additionally, some people find that they are able to manage their budgets more effectively when using fixed rate tariffs.
Ultimately the right option for you depends on your individual needs and preferences. So, take the time to consider your usage habits and budget before making a final decision.
On a standard rate energy tariff, your bill could vary from month to month depending on the market price for electricity. The majority of UK households now get this type as it means they don’t have any surprises, like those on fixed tariffs before these were taken off the market.
Can I save money with an Economy 7 tariff?
An economy 7 tariff is a type of energy plan that offers separate unit costs for night and day rates. The main difference between a variable and fixed economy 7 tariff is that the latter offers more predictable pricing. This type of tariff is designed for households that use the majority of their energy at night or have storage heaters.
With an economy 7 tariff, you can take advantage of lower night rates to power your home during off-peak hours. This can help you save money on your energy bill, as well as reducing your impact on the environment.
In 2021, the average economy 7 tariff bill was £933, based on a household energy usage of 5,100 kWh. This is significantly higher than the average economy 10 tariff bill of £725, based on the same level of energy usage.
The price that people pay for their energy depends on numerous factors, such as the type of tariff they are on and the supplier they use. However, data collected by government figures has found that economy 7 customers tend to pay more for their energy than those who are not on this tariff.
On fixed or variable rates with Economy 7…
Fixed rates mean that the cost of energy will never change, while variable ones are subject to increase or decrease at any time. This means you can expect your night and day prices per kilowatt hour (kWh) pumped into your home’s meter each month – which could be costly if they go up more than expected!
Tips on reducing the running costs of your home
The importance of reducing consumption cannot be overstated. Not only does it help to conserve resources, but it also helps to save money. One of the best ways to reduce consumption is to become more energy-efficient. This can be done in a number of ways, such as using energy-efficient appliances, insulating your home, and using natural lighting whenever possible. Additionally, it’s important to be aware of your energy usage and to make changes accordingly. For example, if you notice that you’re using more electricity during the day, you may want to consider changing your habits or investing in solar panels. By making small changes in your daily routine, you can make a big impact on your energy consumption – and your bottom line.
There are a number of ways for you to start reducing your bills and improving your energy efficiency at home. One of the simplest and most effective ways to do this is by using energy-efficient appliances and lighting. By investing in more efficient options, such as LED lights and newer models of refrigerators and washing machines, you can cut down on your electricity usage without having to make a major change to your daily routine.
Additionally, it’s important to take steps to insulate your home properly. This may involve sealing up any drafty windows or replacing old doors with more energy-efficient ones.
Another key way to improve your home’s efficiency is by making changes to the way that you use energy throughout the day. For example, if you notice that you are consuming more electricity during certain times or on specific days of the week,
Setting a control timer for your heating or air conditioning system is another great way to reduce your energy usage. This allows you to optimize your energy use for when you actually need it and save money on your monthly utility bills.
Other simple changes, such as replacing any old light bulbs with more efficient LED or CFL bulbs, can also help to cut down on the amount of electricity that your home consumes. By making these small adjustments, you can significantly reduce your home’s carbon footprint and contribute to a greener future for everyone.
If you are interested in taking further steps towards improving the efficiency of your home, there are several options available to you. Many local governments offer grants or subsidies for purchasing renewable energy systems like solar panels or wind turbines; which you can read about here.
For more information about this post and how Energy Solutions can help with your Electricity, Gas, or Water, click on the links, or check out the contact details at the bottom of the page.