By 1 January 2019 all suppliers, including SSE, will be capping prices for customers on the Standard Variable Tariff and other default tariffs in line with new regulations from Ofgem. This has been put in place following Government legislation. The methodology for calculating the level of the cap has been set by Ofgem.
As a result, the vast majority of SSE’s Standard Variable Tariff (SVT) customers will see a reduction in their annual energy costs. The typical dual fuel SVT customer paying by monthly direct debit will see their costs fall by around £59 per annum1. The new typical bill for a Default Tariff customer paying by monthly direct debit will be £1,1371.
However, due to the way the cap is calculated there will be a comparatively small number of customers that will see an increase in their overall energy costs. Customers currently on the Energy Assist Tariff, customers with very low usage or unusual metering types are the most likely to be affected. SSE has worked hard to keep the number of customers affected by this to a minimum and keep any potential increases as small as possible.
SSE is writing to all of its customers negatively affected by the price cap with information about how their prices will be changing and details of the additional assistance on offer to help mitigate the changes.
Ofgem will review the level of the cap in February, and any updates required to reflect changes in underlying costs will be implemented in April. Following this review Ofgem will continue to assess costs in the market every six months until at least 2020 and update the level of the cap accordingly.
More information about the Default Tariff Cap and the support available to customers is available on SSE.co.uk.
1Our standard GB domestic gas and electricity prices for dual fuel customers will go down by an average of £59, calculated based on a national average across all regions for customers on the Standard Variable Tariff paying by Direct Debit with a paper bill and on an unrestricted meter. Using Ofgem’s annual Typical Domestic Consumption Values of 3,100 kWh for electricity and 12,000 kWh for gas. All prices are inclusive of VAT at 5%.