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The Markets
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The Markets
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Energy

Merseyside and north Wales homeowners face higher electricity bills despite price cap

People living in northern Wales, Cheshire and Merseyside are set to face £121 extra in electricity bills than those elsewhere

People living in north Wales, Cheshire and Merseyside will pay £121 extra for electricity bills than those elsewhere due to regional network infrastructure costs, according to regulator Ofgem.

Despite the energy price cap introduced at the start of October, which guaranteed electricity at £0.34/kWh down from £0.46/kWh, households in these areas are charged £0.36/kWh, equivalent to £66 more than the average home each year.

Some households are better off due to their location too, with those living in the Northeast set to pay £55 less over the course of the year at a rate of £0.32/kWh.

"In general, suppliers set prices based on differences on network charges. This means that the price you pay reflects how much it costs to transport energy to where you live," said Ofgem.

Due to the cap on electricity prices, the average electricity bill will be reduced to £2,500 for UK households, but several factors cause prices to vary.

Location is a key factor, with infrastructure maintenance costs differing, meaning the average bill in Merseyside will be £2,566, but £2,445 for those living in the Northeast.

Other factors include size, design and age of houses, as well as the type of contact, which can increase bills significantly.

A four-bedroom house in north Wales could accumulate a £3,279 bill, whilst a two-bedroom homeowner in the East Midlands will only pay £1,187, according to Eco Experts energy bill calculator.

Despite ensuring cheaper bills for consumers, some have raised concern over the price cap, with Institute for Fiscal Studies director Paul Johnson saying: “This is a huge policy intervention which could easily cost over £100 billion in the next year alone”.

Ofgem revises the price cap quarterly, with a new figure set to be announced on 24 November and implemented from the start of 2023.

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