Standard credit price cap level cut by £261 from 1 April 2024

The standard credit (receipt of bill) price cap level fell to £1,796 from 1 April 2024, a decrease of £261, or 13%, compared with the previous level¹. The change was announced by Ofgem, the energy regulator, and covers the period from 1 April to 30 June 2024¹.

For the same period, the price for energy for a typical household using electricity and gas and paying by direct debit fell to £1,690 per year, which is £238 lower than the cap set for 1 January to 31 March 2024 (£1,928)¹. The amount an individual household pays depends on actual usage, where it lives, and its meter and payment type¹.

Households that pay on receipt of bill still pay an additional £106 compared with paying by direct debit, down from £130¹. Ofgem said it had not made a final decision on the extra costs for people who pay when they receive their bill, and planned to consult on the issue by the end of the year, with any reduction or end to that extra cost taking effect from April 2025 if implemented¹.

Ofgem also announced a lasting solution to eliminate the extra costs of paying for energy using a prepayment meter, meaning people using a prepayment meter will no longer pay more than those paying by direct debit¹.

Fair By Design said the extra cost for those who pay when they receive their bill still exists, and that it wants to see it completely eliminated¹. The organisation has called for a social tariff, a targeted discount energy tariff for qualifying low-income consumers, as a solution to affordability¹.

Why it matters for households

The cap level is not a limit on a household's total bill. It sets the maximum a supplier can charge for each unit of gas and electricity, and for standing charges, so what a household pays depends on how much energy it uses, where it lives, and how it pays¹.

From 1 April 2024, the gap between paying by direct debit and paying on receipt of bill narrowed to £106 a year, from £130¹. That premium applies to households that pay when their bill arrives rather than by direct debit. Prepayment meter customers no longer pay more than direct debit customers under the arrangement announced by Ofgem¹.

The figures cover the three months from 1 April to 30 June 2024¹. Any change to the standard credit premium would not take effect before April 2025, and only if Ofgem implements it following its consultation¹.

What happens next

Ofgem said it had not made a final decision on the extra costs for people who pay on receipt of bill, and planned to publish a consultation by the end of the year¹. If implemented, a reduction or end to that extra cost would happen from April 2025¹. Further detail on the timing and outcome of that consultation has not been reported¹.