the energy price cap set by the regulator 0fgem. that is the maximum amount that suppliers are allowed to charge per unit of gas and electricity for what it calls a typical household. that fell to about £2000 last month. that s a drop of 17% in annual bills for anyone on a standard tariff for gas and electricity, paying by direct debit, which is most households. as a reminder of how we got here, when the cap launched, it wasjust over £1,000. when the cap launched, and that figure remained largely the same until it reallyjumped in october last year. that was due to high wholesale energy prices, partly as a result of the war in ukraine. the government then stepped in last autumn with its own support scheme to help households, the energy price guarantee, which capped unit charges untiljune this year, so a typical household s annual bill would be £2,500.
month s rise and today they were increased again to 0.75%, though the bank suggested they would not go up as fast as expected from here. last month the bank predicted that inflation was already heading for 30 year highs above 7%, well above the bank s target of 2%, but now after the invasion of ukraine, energy prices have gone even higher, pushing forecasts above 8%, and with the energy price cap set to go up again in october, that could top 10% by the end of the year. what you can see very clearly here and on household energy bills up and down the country is just the start of an energy price shock and the problem there is that both growth in the economy and prices go in the wrong direction, growth slowing, prices going up and up, and the issue is that this could last many months more, and it s not at all clear what interest rates going up is going to do to solve it. the consequences of the war