British Gas issues unwelcome message to customers from October

British Gas has told customers on its variable tariffs that their energy bills "will go up" from October as it issues a warning over the looming Ofgem price cap change.

Energy regulator Ofgem has confirmed the energy price cap will rise by 2% from October 1 for households in England, Scotland and Wales, despite falling wholesale prices. The price increase means the average household paying by direct debit for gas and electricity will see bills rise to £1,755 per year from October 1 - an increase of £35 from the current price of £1,720.

Standing charges, which are what consumers pay per day to have energy supplied to their homes, will also rise from October by 4% for electricity and 14% for gas, or 7p per day, which is primarily driven by the government's expansion of the Warm Home Discount Scheme.

The price cap sets the maximum rate per unit and standing charge that customers can be charged by suppliers for their energy use - not the total bill, so those who use more energy will ultimately pay more.

But the price cap rate is only paid by households that aren't currently on a fixed tariff, so if you switch, it's possible to undercut the price cap significantly.

In response to the latest price cap being confirmed, British Gas issued a message to customers on its website warning that customers on a variable tariff will face higher bills from October.

British Gas said: "The energy price cap is going up. Ofgem are increasing the energy price cap from 1st October. If you're on a variable tariff, your prices will go up.

"Switch to one of our fixed tariffs and relax, knowing your prices won't change. And if we offer a cheaper one in the future, you can switch for free."

The energy supplier warned customers that the price cap doesn't mean you'll only be charged a maximum of £1,755 from October, as the more energy you use, the more you'll pay.

British Gas added that it's possible to avoid the October price cap increase by switching to a fixed rate tariff before the change, as this allows you to lock in a price now which will remain the same for the length of your contract - effectively saving you from further price increases if the price cap rises again.

The supplier said: "If you're on a fixed tariff, the price cap won't affect you as your prices are locked in for the length of your contract. We won't increase the price you pay, unless the government increases VAT. You can check what tariff you're on in your online account."

It added: "Our fixed energy tariffs can provide peace of mind that your prices won't increase this winter. Check out all our available tariffs in your online account."