Ofgem bases the price cap on how much it would cost a typical energy supplier to provide energy for an average home
It uses several factors affecting energy bills in its calculations, as well as considering usage levels and market data across a given period.
Key factors include wholesale gas and electricity costs for suppliers, the network costs they have to pay – such as infrastructure – and the operating costs and profit margin of suppliers.How will a price cap freeze work?that the price cap will go no higher than £2,500.on oil and gas producers and will instead fund the entire package through general taxation, which will cause a short-term surge in Government borrowing.
Ms Truss said: “Putin’s war in Ukraine and weaponisation of gas supply in Europe is causing global prices to rise – and this has only made clearer that we must boost our long-term energy security and supply. We will take action immediately to help people and businesses with bills, but also take decisive action to tackle the root cause of these problems, so that we are not in this position again.”
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